IDEAS home Printed from https://ideas.repec.org/a/sae/soudev/v4y2009i2p253-281.html
   My bibliography  Save this article

Economic Cooperation in South Asia

Author

Listed:
  • A. Ganesh Kumar
  • Gordhan K. Saini

    (Indira Gandhi Institute of Development Research Mumbai, India)

Abstract

This article attempts to evaluate the Pareto optimality of SAFTA and three other alternative sets of coordinated trade policies that go beyond SAFTA for all the member states. These include (a) extended preferential trading between SAFTA with other major trading blocs, (b) full trade liberalisation by South Asian countries and (c) SAFTA plus a customs union. The analysis, using the standard static Global Trade Analysis Project (GTAP) model, shows that (a) there would be winners and losers amongst the member states, (b) the winners and losers vary across alternative scenarios that represent different trade policy regime and (c) the gains/losses as the case may be are not very large. Thus, the welfare basis for establishing SAFTA or for deeper trade policy coordination is not very strong. Justification for SAFTA may lie in other dimensions of regional cooperation than in mere tariff policy coordination.

Suggested Citation

  • A. Ganesh Kumar & Gordhan K. Saini, 2009. "Economic Cooperation in South Asia," Journal of South Asian Development, , vol. 4(2), pages 253-281, July.
    • Handle: RePEc:sae:soudev:v:4:y:2009:i:2:p:253-281
    DOI: 10.1177/097317410900400205
    as

    Download full text from publisher

    File URL: https://journals.sagepub.com/doi/10.1177/097317410900400205
    Download Restriction: no
    File URL: https://libkey.io/10.1177/097317410900400205?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Jeffrey D. Lewis & Sherman Robinson & Karen Thierfelder, 2003. "Free Trade Agreements and the SADC Economies," Journal of African Economies, Centre for the Study of African Economies, vol. 12(2), pages 156-206, June.
    2. Robinson, Sherman & Thierfelder, Karen, 2002. "Trade liberalisation and regional integration: the search for large numbers," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 46(4), pages 1-20.
    3. Khan, Saleem M., 1999. "South Asian Association for Regional Cooperation1, 2, 3, 4," Journal of Asian Economics, Elsevier, vol. 10(3), pages 489-495.
    4. Baldwin, Richard E. & Venables, Anthony J., 1995. "Regional economic integration," Handbook of International Economics, in: G. M. Grossman & K. Rogoff (ed.), Handbook of International Economics, edition 1, volume 3, chapter 31, pages 1597-1644, Elsevier.
    5. Arvind Panagariya, 2000. "Preferential Trade Liberalization: The Traditional Theory and New Developments," Journal of Economic Literature, American Economic Association, vol. 38(2), pages 287-331, June.
    6. A. Ganesh Kumar & Gordhan Kumar Saini, 2007. "Economic co-operation in South Asia: The Dilemma of SAFTA and beyond," Indira Gandhi Institute of Development Research, Mumbai Working Papers 2007-017, Indira Gandhi Institute of Development Research, Mumbai, India.
    7. M. Akhlaqur Rahman & Ayubur Rahman Bhuyan & Sadrel Reza, 1981. "The Trade Effects of a South Asian Customs Union. An Expository Study," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 20(1), pages 61-80.
    8. Ngo Van Long & Antoine Soubeyran, 1997. "Customs Union and Gains from Trade Under Imperfect Competition: Variation of a Kemp-Wan Theme," The Japanese Economic Review, Japanese Economic Association, vol. 48(2), pages 166-175, June.
    9. Arvind Panagariya & Jagdish Bhagwati, 1996. "The Economics of Preferential Trade Agreements," Books, American Enterprise Institute, number 51856, September.
    10. Kemp, Murray C. & Wan, Henry Jr., 1976. "An elementary proposition concerning the formation of customs unions," Journal of International Economics, Elsevier, vol. 6(1), pages 95-97, February.
    11. Arvind Panagariya, 1996. "The Free Trade Area of the Americas: Good for Latin America?," The World Economy, Wiley Blackwell, vol. 19(5), pages 485-515, September.
    12. Jayatilleke S. Bandara & Wusheng Yu, 2003. "How Desirable is the South Asian Free Trade Area? A Quantitative Economic Assessment," The World Economy, Wiley Blackwell, vol. 26(9), pages 1293-1323, September.
    13. Pitigala, Nihal, 2005. "What does regional trade in South Asia reveal about future trade integration? Some empirical evidence," Policy Research Working Paper Series 3497, The World Bank.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Gordhan K. Saini, 2009. "Non-Tariff Measures and Indian Textiles and Clothing Exports," Trade Working Papers 22407, East Asian Bureau of Economic Research.
    2. Badri Narayanan & Sachin Kumar Sharma, 2016. "An Analysis of Tariff Reductions in the Trans-Pacific Partnership (TPP): Implications for the Indian Economy," Margin: The Journal of Applied Economic Research, National Council of Applied Economic Research, vol. 10(1), pages 1-34, February.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. A. Ganesh Kumar & Gordhan Kumar Saini, 2007. "Economic co-operation in South Asia: The Dilemma of SAFTA and beyond," Indira Gandhi Institute of Development Research, Mumbai Working Papers 2007-017, Indira Gandhi Institute of Development Research, Mumbai, India.
    2. Burfisher, Mary E. & Robinson, Sherman & Thierfelder, Karen, 2004. "Regionalism," MTID discussion papers 65, International Food Policy Research Institute (IFPRI).
    3. Sangeeta Khorana & Badri G. Narayanan, 2017. "Modelling Effects of Tariff Liberalisation on India’s Key Export Sectors: Analysis of the EU–India Free Trade Agreement," Margin: The Journal of Applied Economic Research, National Council of Applied Economic Research, vol. 11(1), pages 1-22, February.
    4. Tokarick, Stephen, 2011. "Should Countries Worry About Immiserizing Growth?," Conference papers 332133, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    5. Jong‐Wha Lee & Innwon Park & Kwanho Shin, 2008. "Proliferating Regional Trade Arrangements: Why and Whither?," The World Economy, Wiley Blackwell, vol. 31(12), pages 1525-1557, December.
    6. Jayatilleke S. Bandara & Wusheng Yu, 2003. "How Desirable is the South Asian Free Trade Area? A Quantitative Economic Assessment," The World Economy, Wiley Blackwell, vol. 26(9), pages 1293-1323, September.
    7. Jayatilleke S. Bandara & Wusheng Yu, 2007. "Agricultural trade liberalization in the Asia-Pacific region with specific reference to preferential trade agreements - scenario and impact analysis," STUDIES IN TRADE AND INVESTMENT, in: Studies in Trade and Investment - AGRICULTURAL TRADE - PLANTING THE SEEDS OF REGIONAL LIBERALIZATION IN ASIA, volume 60, pages 131-162, United Nations Economic and Social Commission for Asia and the Pacific (ESCAP).
    8. Hossain, Sharif M., 2009. "South Asian Free Trade Area: Implications for Bangladesh," MPRA Paper 18517, University Library of Munich, Germany.
    9. Lucian Cernat, 2001. "ASSESSING REGIONAL TRADE ARRANGEMENTS: ARE SOUTH–SOUTH RTAs MORE TRADE DIVERTING?," International Trade 0109001, University Library of Munich, Germany.
    10. Keck, Alexander & Piermartini, Roberta, 2005. "The economic impact of EPAs in SADC countries," WTO Staff Working Papers ERSD-2005-04, World Trade Organization (WTO), Economic Research and Statistics Division.
    11. Robinson, Sherman & Thierfelder, Karen, 2002. "Trade liberalisation and regional integration: the search for large numbers," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 46(4), pages 1-20.
    12. Xiao-guang Zhang & George Verikios, 2006. "Providing Duty-Free Access to Australian Markets for Least-Developed COuntries: a General Equilibrium Analysis," Economics Discussion / Working Papers 06-09, The University of Western Australia, Department of Economics.
    13. Earl L. Grinols & Peri Silva, 2008. "Industrial targeting in free trade areas with policy independence," Canadian Journal of Economics, Canadian Economics Association, vol. 41(3), pages 796-816, August.
    14. Costas Hadjiyiannis, 2004. "Common markets and trade liberalization," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 37(2), pages 484-508, May.
    15. Satya P. Das & Subhadip Ghosh, 2006. "Endogenous trading bloc formation in a North‐South global economy," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 39(3), pages 809-830, August.
    16. Alpay, Savas, 2003. "How Can Trade Liberalization Be Conducive to a Better Environment?," Conference papers 331113, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    17. Lee, Hiro, 2001. "General equilibrium evaluation of Japan-Singapore free trade agreement," MPRA Paper 82605, University Library of Munich, Germany.
    18. Pokrivcak, Jan, 2007. "Economics and Political Economy of Regional Trade Agreements," Working Papers 7286, TRADEAG - Agricultural Trade Agreements.
    19. Susanto, Dwi & Rosson, C. Parr & Adcock, Flynn J., 2007. "Trade Creation and Trade Diversion in the North American Free Trade Agreement: The Case of the Agricultural Sector," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 39(1), pages 121-134, April.
    20. Philippa Dee, 2005. "The Australia-US Free Trade Agreement: An Assessment," Asia Pacific Economic Papers 345, Australia-Japan Research Centre, Crawford School of Public Policy, The Australian National University.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:sae:soudev:v:4:y:2009:i:2:p:253-281. See general information about how to correct material in RePEc.

    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 CitEc recognized a bibliographic reference but did not link an item in RePEc 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: SAGE Publications (email available below). General contact details of provider: .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.