An Econometric Analysis of India-Sri Lanka Free Trade Agreement
This paper investigates whether the India-Sri Lanka Free Trade Agreement (ISLFTA) has had trade creation or trade diversion effects on the rest of the World. The method used resembles the one used by Romalis (2005) to study NAFTA. In order to use the variations in tariff at the product level, we use six digit HS classification of products. We construct seven panel data sets for the period 1996 to 2006. We use the commodity and time variation in the tariff preferences allowed under ISLFTA, to identify its effect on sourcing of different products from ‘control country’ to ISLFTA region. Using fixed effects model we find that the ISLFTA has been minimally trade creating for control countries.
|Date of creation:||Mar 2010|
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- Susanto, Dwi & Rosson, C. Parr, III & Adcock, Flynn J., 2007. "Trade Creation and Trade Diversion in the North American Free Trade Agreement: The Case of the Agricultural Sector," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 39(01), April.
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