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Testifying the role of regulatory environment in trade facilitation: Impact on intra-regional trade in South-Asia

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  • Tanya GANDHI

    (Jamia Millia Islamia, New Delhi, India)

  • Shahid AHMED

    (Jamia Millia Islamia, New Delhi, India)

Abstract

The intraregional trade in South-Asia region is only 6.1 percent of its total trade due to a number of factors, including Regulatory environment governing international trade. This study examines the impact of trade facilitation in Regulatory environment on bilateral exports within the region. A panel gravity model augmented with a self-composed index for Regulatory environment for both exporting and importing countries in South-Asia is estimated. It reveals that enhanced regulatory environment of importing country impacts intra-regional trade positively whereas, that of the exporting country impacts the same negatively. The estimates of trade potential within the region are significantly encouraging. The simulations’ results reveal that by making collective efforts in trade facilitation in regulatory environment, the intra-regional exports could increase tremendously in a range of scenarios which could not be achieved even by phasing out of tariffs within the region.

Suggested Citation

  • Tanya GANDHI & Shahid AHMED, 2020. "Testifying the role of regulatory environment in trade facilitation: Impact on intra-regional trade in South-Asia," Theoretical and Applied Economics, Asociatia Generala a Economistilor din Romania / Editura Economica, vol. 0(4(625), W), pages 195-216, Winter.
    • Handle: RePEc:agr:journl:v:4(625):y:2020:i:4(625):p:195-216
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