IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Login to save this paper or follow this series

India's Trade Integration, Realising the Potential

  • Przemyslaw Kowalski
  • Nora Dihel

This study examines economic implications of India’s trade and trade policy reforms during the period from 1990 to 2007. It first describes India’s economic growth and the composition and performance of its trade at the product and broad sector level. Next, recent reforms and the current trade policy stance are assessed and recommendations for further policy reforms are discussed. The impact of India’s openness on its total factor productivity is also addressed. The analysis shows that India has gone a long way in reducing its tariffs on non-agricultural products as well as selected non-tariff barriers and that this had a positive impact on the economy. Nevertheless, moderate to high protection still persists and adds to the hurdles faced by Indian enterprises. Overall, India’s pattern of specialisation is still affected by the pre- 1990s policies; while certain services have recently performed very well, their high reliance on skilled labour and capital means they can only address a small portion of the Indian jobless growth problem. India’s endowment structure and the recent services-dominated export profile suggest that it needs to improve conditions for the development of its manufacturing sector, with a particular emphasis—at this stage—on labour-intensive activities. The remaining goods and services trade barriers combine with domestic red tape, infrastructure bottlenecks and factor markets rigidities that restrict new entry and competition to keep India’s competitiveness, particularly in agriculture and manufacturing, at relatively low levels. In an effort to offset the remaining protection, India has developed a complex system of duty exemption schemes, special investment and establishment rules and special economic zones (SEZs) that provide incentives particularly to exporting firms. The paper argues that, while such a policy can have important demonstration effects, across-the-board reduction of trade and business barriers could have more beneficial economy-wide and export effects.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://dx.doi.org/10.1787/224123212531
Our checks indicate that this address may not be valid because: 403 Forbidden (http://dx.doi.org/10.1787/224123212531 [303 See Other]--> http://www.oecd-ilibrary.org/trade/india-s-trade-integration-realising-the-potential_224123212531). If this is indeed the case, please notify ()


Download Restriction: no

Paper provided by OECD Publishing in its series OECD Trade Policy Papers with number 88.

as
in new window

Length:
Date of creation: 19 May 2009
Date of revision:
Handle: RePEc:oec:traaab:88-en
Contact details of provider: Postal: 2 rue Andre Pascal, 75775 Paris Cedex 16
Phone: 33-(0)-1-45 24 82 00
Fax: 33-(0)-1-45 24 85 00
Web page: http://www.oecd.org
Email:


More information through EDIRC

No references listed on IDEAS
You can help add them by filling out this form.

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:oec:traaab:88-en. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ()

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.