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India’s Role in South Asia Trade and Investment Integration

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  • Kumar, Rajiv

    ()
    (Indian Council for Research on International Economics Relations)

  • Singh, Manjeeta

    (Indian Council for Research on International Economics Relations)

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    Abstract

    Recent developments in South Asian countries, especially the re-emergence of democratic governments, new growth momentum despite the global economic downturn and greater openness, warrant a fresh look at the region’s prospects for economic integration. On the basis of a thorough review of the literature on potential and prospects of regional integration in South Asia and after examining the trends in intra-SAARC trade and investment flows, this paper finds that the progress in regional cooperation has been far short of potential. The paper, therefore, focuses on the ‘real impediments’ to regional integration and on that basis makes a set of policy oriented recommendations for furthering deeper regional integration in South Asia. It also emphasizes that given its dominant size, human resources, and aspirations for a global role, India will have to take on a disproportionately larger responsibility for promoting regional cooperation in South Asia. However, regional integration will not be achieved by India’s unilateral actions alone. Neighboring governments will have to respond positively to Indian initiatives for successful regional integration in South Asia.

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    File URL: http://aric.adb.org/pdf/workingpaper/WP32_Indias_Role_in_South_Asia_Trade.pdf
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    Bibliographic Info

    Paper provided by Asian Development Bank in its series Working Papers on Regional Economic Integration with number 32.

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    Length: 52 pages
    Date of creation: 01 Jul 2009
    Date of revision:
    Handle: RePEc:ris:adbrei:0032

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    Keywords: South Asia; economic integration; regional trade; foreign direct investment;

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    1. Plummer, Michael G., 2006. "The ASEAN Economic Community and the European Experience," Working Papers on Regional Economic Integration 1, Asian Development Bank.
    2. Das, Samantak & Pohit, Sanjib, . "Quantifying transport, regulatory and other costs of India–Bangladesh trade," Working Papers 92, National Council of Applied Economic Research.
    3. Hassan, M. Kabir, 2001. "Is SAARC a viable economic block? evidence from gravity model," Journal of Asian Economics, Elsevier, vol. 12(2), pages 263-290.
    4. Aradhna Aggarwal, 2008. "Regional Economic Integration and FDI in South Asia - Prospects and Problems," Macroeconomics Working Papers 22141, East Asian Bureau of Economic Research.
    5. Wilson, John S. & Otsuki, Tsunehiro, 2007. "Regional integration in South Asia : what role for trade facilitation ?," Policy Research Working Paper Series 4423, The World Bank.
    6. Kabir, ASM, 2007. "Sanguinity and aspiration toward South Asian Regional integration: a case study of the South Asian Free Trade Area (SAFTA) Agreement," MPRA Paper 3871, University Library of Munich, Germany.
    7. Rahman, Mohammad Mafizur, 2005. "Bangladesh-India Bilateral Trade: Causes of Imbalance and Measures for Improvement," Working Papers 1, University of Sydney, School of Economics.
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