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Impact of India-ASEAN Free Trade Agreement: An Assessment from the Trade Creation and Trade Diversion Effects

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  • Loitongbam Bishwanjit Singh

Abstract

This article investigates the impacts on the India–Association of Southeast Asian Nations (ASEAN) Free Trade Agreement (IAFTA) on trade creation and trade diversion. The gravity model is employed, where multilateral resistance terms are included. A panel data set of 45 countries that included India, ASEAN-10 nations and India’s top 34 trading partners in 2018 were used for the period from 1996 to 2018. The article explored that IAFTA leads to a trade creation in total bilateral trade in terms of exports and imports. The analysis further explored that the import creation effect was higher than that of the export creation effect.

Suggested Citation

  • Loitongbam Bishwanjit Singh, 2021. "Impact of India-ASEAN Free Trade Agreement: An Assessment from the Trade Creation and Trade Diversion Effects," Foreign Trade Review, , vol. 56(4), pages 400-414, November.
    • Handle: RePEc:sae:fortra:v:56:y:2021:i:4:p:400-414
    DOI: 10.1177/00157325211021503
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    3. Priyanka Khati & Chanwahn Kim, 2022. "Impact of India’s Free Trade Agreement with ASEAN on Its Goods Exports: A Gravity Model Analysis," Economies, MDPI, vol. 11(1), pages 1-19, December.
    4. Hajra Manzoor & Parvez Ahmad Mir, 2023. "General Equilibrium Trade Policy Analysis among One Belt One Road Nations Using Structural Gravity Framework," Foreign Trade Review, , vol. 58(4), pages 484-503, November.
    5. Busani Moyo, 2024. "Impact of SADC Free Trade Area on Southern Africa’s Intra-Trade Performance: Implications for the African Continental Free Trade Area," Foreign Trade Review, , vol. 59(1), pages 146-180, February.

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