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Liberalisation reform and export performance of India

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  • Ramesh C. Paudel

Abstract

This paper examines the impact of liberalisation reform on export performance of India. The empirical analysis involves estimating an export demand-supply model for manufacturing and merchandised exports, applying ARDL approach to cointegration using annual data for the period 1975-2008. The main advantage of this approach is that, apart from providing robust estimations in small sample sizes, it needs no prior knowledge of the integration properties of the variables. The results suggest that manufacturing and merchandise export demand are mainly determined by world demand, while manufacturing export supply is determined by domestic manufacturing output, FDI and overall liberalisation- initiated in the early 1990s. Contrary to the received view, this study failed to detect a significant negative impact of trade protection on export performance; however, overall liberalisations reforms seem to have positive impact in India’s manufacturing export performance but this is not true in the context of merchandised export performance.

Suggested Citation

  • Ramesh C. Paudel, 2014. "Liberalisation reform and export performance of India," ASARC Working Papers 2014-03, The Australian National University, Australia South Asia Research Centre.
    • Handle: RePEc:pas:asarcc:2014-03
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    Cited by:

    1. Ramesh C. Paudel & Chakra Pani Acharya, 2022. "Cooperatives and economic growth in a developing country: The case of Nepal," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 93(3), pages 797-815, September.
    2. Batavia, Bala & Nandakumar, Parameswar, 2017. "The equivalence of export subsidies and import tariff reductions in a macroeconomic model," The Journal of Economic Asymmetries, Elsevier, vol. 15(C), pages 76-80.
    3. Ramesh C. Paudel & Chakra Pani Acharya, 2020. "Financial Development and Economic Growth: Evidence from Nepal," NRB Economic Review, Nepal Rastra Bank, Economic Research Department, vol. 32(1), pages 15-36, April.
    4. Ramesh C. Paudel & Resham Thapa-Parajuli & Majed Alharthi, 2020. "Electricity Consumption and Export Performance: Evidence from Nepal," International Journal of Energy Economics and Policy, Econjournals, vol. 10(6), pages 529-535.

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    More about this item

    Keywords

    Exports; Liberalization; Trade; International Trade; India;
    All these keywords.

    JEL classification:

    • F1 - International Economics - - Trade
    • F3 - International Economics - - International Finance
    • F10 - International Economics - - Trade - - - General
    • P33 - Political Economy and Comparative Economic Systems - - Socialist Institutions and Their Transitions - - - International Trade, Finance, Investment, Relations, and Aid
    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East

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