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Effects of Proposed Free Trade Agreement between India and Bangladesh

Author

Listed:
  • Mahinda Siriwardana
  • Jinmei Yang

    (Mahinda Siriwardana (corresponding author) and Jinmei Yang are at the School of Economics, the University of New England, Armidale, NSW 2351, Australia. Email: asiriwar@une.edu.au and jmyang@une.edu.au)

Abstract

There have been substantial efforts to intensify economic interactions between India and Bangladesh in recent times. Despite these, trade imbalance remains a key feature in their bilateral trade. India maintains a huge trade surplus against Bangladesh and the trade policy negotiators are hopeful that a free trade agreement (FTA) between the two countries may address this issue. For instance, Indian investment in Bangladesh can enhance new supply and export capacities under free trade arrangements. This article examines the possible effects of proposed FTA between India and Bangladesh using the GTAP model. The analysis highlights the possible costs and benefits to the two nations in the event that the FTA is negotiated.

Suggested Citation

  • Mahinda Siriwardana & Jinmei Yang, 2007. "Effects of Proposed Free Trade Agreement between India and Bangladesh," South Asia Economic Journal, Institute of Policy Studies of Sri Lanka, vol. 8(1), pages 21-38, January.
    • Handle: RePEc:sae:soueco:v:8:y:2007:i:1:p:21-38
    DOI: 10.1177/139156140600800102
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    References listed on IDEAS

    as
    1. Peter J. Lloyd & Donald Maclaren, 2004. "Gains and Losses from Regional Trading Agreements: A Survey," The Economic Record, The Economic Society of Australia, vol. 80(251), pages 445-467, December.
    2. Mahinda Siriwardana, 2005. "Trade Liberalisation between Australia, India and South Africa: Prospects for a Dynamic Growth Triangle," The IUP Journal of Applied Economics, IUP Publications, vol. 0(4), pages 20-35, July.
    3. Siriwardana, Mahinda, 2004. "An Analysis of the Impact of Indo-Lanka Free Trade Agreement and Its Implications for Free Trade in South Asia," Journal of Economic Integration, Center for Economic Integration, Sejong University, vol. 19, pages 568-589.
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Prabir De & Biswa N. Bhattacharyay, 2007. "Deepening India–Bangladesh Economic Cooperation : Challenges and Opportunities," Macroeconomics Working Papers 22098, East Asian Bureau of Economic Research.
    2. Mustafizur Rahman & Towfiqul Islam Khan & Ashiqun Nabi & Tapas Kumar Paul, 2011. "Bangladesh’s Export Opportunities in the Indian Market," South Asia Economic Journal, Institute of Policy Studies of Sri Lanka, vol. 12(1), pages 117-141, March.
    3. D'Artis Kancs & Pavel Ciaian, 2010. "Factor content of bilateral trade: the role of firm heterogeneity and transaction costs," Agricultural Economics, International Association of Agricultural Economists, vol. 41(3‐4), pages 305-317, May.
    4. Mustafizur Rahman & Mazbahul Golam Ahamad & A K M Nazrul Islam & Muhammad Al Amin, 2012. "Agricultural Trade between Bangladesh and India: An Analysis of Trends, Trading Patterns and Determinants," CPD-CMI Working Paper 3, Centre for Policy Dialogue (CPD).
    5. Mustafizur Rahman & Towfiqul Islam Khan & Ashiqun Nabi & Tapas Kumar Paul, 2010. "Bangladesh's Export Opportunities in the Indian Market: Addressing Barriers and Strategies for Future," CPD Working Paper 90, Centre for Policy Dialogue (CPD).
    6. Rakesh Kumar, 2021. "South Asia: Multilateral trade agreements and untapped regional trade integration," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 26(2), pages 2891-2903, April.

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    More about this item

    Keywords

    JEL: F15; Free Trade Agreement; General Equilibrium; GTAP; India; Bangladesh;
    All these keywords.

    JEL classification:

    • F15 - International Economics - - Trade - - - Economic Integration

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