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Analyzing Pakistan’s Trade Opportunity with Turkey

Author

Listed:
  • Asha Gul

    (Teaching and Research Fellow, Center for Research in Economics and Business (CREB), Lahore School of Economics.)

Abstract

Growing economic cooperation between the Pakistani and Turkish governments—manifested in the recently proposed preferential trade agreement (PTA)—has served to strengthen the historically good relations between both countries. This paper explores the trade relationship between Pakistan and Turkey in an attempt to analyze the potential gains for Pakistan under the proposed PTA. We evaluate potential trade opportunities using descriptive statistics and three trade indices: a trade complementarity index, export similarity index, and intraindustry index. Our findings suggest that Pakistan’s trade surplus with Turkey, strong export similarities, and intra-industry trade would allow greater opportunities for firm synergies between the two countries. This, in turn, would help Pakistan achieve greater value addition and a broader market base for its exports. The Government of Pakistan should, therefore, lobby strongly for the proposed PTA (which might later evolve into a free trade agreement) and leverage the agreement in such a way that Pakistan can maximize its potential benefits.

Suggested Citation

  • Asha Gul, 2014. "Analyzing Pakistan’s Trade Opportunity with Turkey," Lahore Journal of Economics, Department of Economics, The Lahore School of Economics, vol. 19(Special E), pages 349-370, September.
    • Handle: RePEc:lje:journl:v:19:y:2014:i:sp:p:349-370
    as

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    File URL: http://lahoreschoolofeconomics.edu.pk/EconomicsJournal/Journals/Volume%2019/Issue%20SP/15%20Asha%20Gul%20Final.pdf
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    References listed on IDEAS

    as
    1. Adnan Akram, 2013. "Pak-SAARC Intra-industry Trade," PIDE-Working Papers 2013:93, Pakistan Institute of Development Economics.
    2. Mamoon, Dawood & Paracha, Sohail & Mughal, Hammad & Ayesha, Anam, 2011. "Pakistan's trade competitiveness & complementarities in South Asia," MPRA Paper 31369, University Library of Munich, Germany.
    3. Shaista Khan & Ihtisham ul Haq & Dilawar Khan, 2013. "An Empirical Analysis of Pakistan’s Bilateral Trade: A Gravity Model Approach," Romanian Economic Journal, Department of International Business and Economics from the Academy of Economic Studies Bucharest, vol. 16(48), pages 103-120, June.
    Full references (including those not matched with items on IDEAS)

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    Cited by:

    1. Ali, Ashfaque, 2017. "A CGE Analysis of Pakistan-Turkey Free Trade Agreement," MPRA Paper 78318, University Library of Munich, Germany.

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    More about this item

    Keywords

    Preferential trade agreement; Pakistan; Turkey; trade complementarity index; export similarity index; intraindustry trade index;
    All these keywords.

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • F15 - International Economics - - Trade - - - Economic Integration

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