Reassessing the impact of the ASEAN-India Free Trade Agreement

Research output: Contribution to journalArticle

Abstract

The ratification of the ASEAN-India Free Trade Agreement (AIFTA) in 2009 signals a potential for increased trade flows between ASEAN and India. Previous studies have focussed mainly on the welfare impact of the agreement and its impact on overall trade, especially trade in agricultural products. The first objective of this study seeks to compare the impact of the AIFTA on the exports of manufactured goods from ASEAN to India and vice versa. The second is to ascertain the relative importance of the scheduled tariff liberalization in the AIFTA compared with other contributory factors in the export of manufactured goods between ASEAN and India. The study uses an augmented gravity model as this type of model allows for the control of other trade related variables and to quantify any changes in a country s trade due to the agreement. The main findings in this study indicate that ASEAN gains more from the scheduled tariff liberalization in this agreement compared to India. However, the impact of tariff liberalization on the exports of manufactured goods from ASEAN and India with each other is relatively smaller compared to other contributory factors, especially trade costs. The AIFTA will have to strengthen specific trade facilitation measures in the agreement in order to increase exports of manufactured goods from ASEAN to India and vice versa.

Original languageEnglish
Pages (from-to)99-110
Number of pages12
JournalJurnal Ekonomi Malaysia
Volume48
Issue number2
Publication statusPublished - 2014

Fingerprint

India
Free trade agreements
Tariffs
Liberalization
Factors
Relative importance
Trade facilitation
Gravity model
Trade flows
Agricultural products
Trade costs
Ratification

Keywords

  • ASEAN-5
  • ASEAN-India FTA
  • Exports
  • Gravity model
  • India
  • Manufactured goads
  • Tariffs

ASJC Scopus subject areas

  • Business, Management and Accounting (miscellaneous)

Cite this

Reassessing the impact of the ASEAN-India Free Trade Agreement. / Tham, Siew Yean; Rew, Kam Jia Yi.

In: Jurnal Ekonomi Malaysia, Vol. 48, No. 2, 2014, p. 99-110.

Research output: Contribution to journalArticle

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