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Export of Environmental Goods: India's Potential and Constraints

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  • Van Son Nguyen
  • Kaliappa Kalirajan

Abstract

The increasing awareness of climate change and its impact on overall economic growth has encouraged many countries to pursue environmental friendly production and consumption of goods and services. Based on their comparative advantages, developing countries too are emerging as exporters of environmental goods and services (EGS) along with developed countries. An important question in this context is whether these emerging EGS exporting developing economies are able to realize their export potential fully. Using data between 1996 and 2010, this paper identifies the constraints that make India, which is one of the emerging EGS exporters, not able to realize its export potential of environmental goods (EG). The empirical results show that the growth of India's exports of EG was negatively affected by its ‘behind the border' constraints, such as weak infrastructure and institutions, while the effect of ‘explicit beyond the border' constraints, such as partner-countries' tariff and exchange rate on the exports of EG was relatively small. The reduction of India's trading partners' ‘implicit beyond the border' constraints, such as weak infrastructure and institutions has made significant contribution to India's exports of EG, especially during the period 2005 – 2010.

Suggested Citation

  • Van Son Nguyen & Kaliappa Kalirajan, 2013. "Export of Environmental Goods: India's Potential and Constraints," ASARC Working Papers 2013-15, The Australian National University, Australia South Asia Research Centre.
    • Handle: RePEc:pas:asarcc:2013-15
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    Cited by:

    1. Natalia Zugravu-Soilita, 2018. "The impact of trade in environmental goods on pollution: what are we learning from the transition economies’ experience?," Environmental Economics and Policy Studies, Springer;Society for Environmental Economics and Policy Studies - SEEPS, vol. 20(4), pages 785-827, October.
    2. Natalia Zugravu-Soilita, 2019. "Trade in Environmental Goods and Air Pollution: A Mediation Analysis to Estimate Total, Direct and Indirect Effects," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 74(3), pages 1125-1162, November.
    3. Zaman, Kazi Arif Uz & Kalirajan, Kaliappa, 2019. "Strengthening of energy security & low-carbon growth in Asia: Role of regional energy cooperation through trade," Energy Policy, Elsevier, vol. 133(C).
    4. Zugravu-Soilita, Natalia, 2017. "Trade in Environmental Goods: Empirical Exploration of Direct and Indirect Effects on Pollution by Country’s Trade Status," EIA: Climate Change: Economic Impacts and Adaptation 266287, Fondazione Eni Enrico Mattei (FEEM).

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    More about this item

    Keywords

    Environmental goods and services; stochastic frontier gravity model; 'behind the border' constraints; 'explicit beyond the border constraints'; 'implicit beyond the border' constraints; Asia-Pacific countries.;
    All these keywords.

    JEL classification:

    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy

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