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Why Isn’t India a Major Global Player? The Political Economy of Trade Liberalization

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  • Jayanta Roy
  • Pritam Banerjee
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    Abstract

    The policy reforms initiated in India in the mid-1980s and expanded in 1991 helped support an expansion in India’s trade. Trade reforms since the mid-1990s have been piecemeal. This paper argues that without significant further reform and adoption of a focused trade strategy, the competitiveness of India’s industry will suffer, including in areas such as information technology and related services in which India has established a strong global niche. Critical building blocks of such strategic reforms include further reductions in tariffs, opening services sectors to foreign competition, serious initiatives to reduce trade transaction costs that prioritize integration into international supply-chains, and a greater focus on regional integration.

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    File URL: http://cadmus.eui.eu/bitstream/handle/1814/28917/RSCAS_2013_84.pdf?sequence=1
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    File URL: http://hdl.handle.net/1814/28917
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    Bibliographic Info

    Paper provided by European University Institute in its series RSCAS Working Papers with number 2013/84.

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    Date of creation: Nov 2013
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    Handle: RePEc:rsc:rsceui:2013/84

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    Related research

    Keywords: India; political economy; trade policy; economic development;

    This paper has been announced in the following NEP Reports:

    References

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    1. Robert Koopman & William Powers & Zhi Wang & Shang-Jin Wei, 2011. "Give Credit where Credit is Due: Tracing Value Added in Global Production Chains," Working Papers 312011, Hong Kong Institute for Monetary Research.
    2. Richard Baldwin, 2007. "Multilateralising Regionalism: Sphagetti Bowls as building Blocs on the Path to Global Free Trade," Working Papers id:1231, eSocialSciences.
    3. Pranab Bardhan, 1997. "Corruption and Development: A Review of Issues," Journal of Economic Literature, American Economic Association, vol. 35(3), pages 1320-1346, September.
    4. Mattoo, Aaditya & Rathindran, Randeep, 2006. "Measuring Services Trade Liberalization and Its Impact on Economic Growth: An Illustration," Journal of Economic Integration, Center for Economic Integration, Sejong University, vol. 21, pages 64-98.
    5. T.N. Srinivasan, 2001. "India's Reform of External Sector Policies and Future Multilateral Trade Negotiations," Working Papers 830, Economic Growth Center, Yale University.
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