A Programme of Studies on the Development Experience of the People’s Republic of China (PRC) and India – Isher Judge Ahluwalia, Amitendu Palit and Rajeev Anantaram
Sponsoring Agency: Asian Development Bank
Commencement: August 2007
Completed: June 2008
External Consultants: Bibek Debroy, Manmohan Agarwal, Rajiv Behari Lall, Mohammad Saqib, Anupam Baleshwar Rastogi and Poonam Gupta
The study on mutual lessons to be learnt from the development experience of India and China led by Dr Isher Judge Ahluwalia was sponsored by the Asian Development Bank following a suggestion by the Prime Minister of India, Dr Manmohan Singh at the Annual Meeting of the Asian Development Bank (ADB) in Hyderabad in 2006. The lead institutes for the project were ICRIER in India and the Institute for Public Policy Studies, Peking University in Beijing. Four areas of interest were selected for each country to draw relevant lessons from each other’s development experience. Reforms in the areas of infrastructure, labour market, state owned enterprises and manufacturing sector in China were studied by Indian researchers, and studies of IT and software industry, local entrepreneurship, financial sector reforms and higher and professional education in India were taken up by Chinese researchers. The initial findings were presented at a seminar in Madrid on the occasion of the Annual Meeting of the ADB in May 2008.
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India’s Trade and Cooperation in Services with MERCOSUR and SACU - Amit Shovan Ray, Amitendu Palit, Manisha Gupta and Shounkie Nawani
Sponsoring Agency: Ministry of Commerce & Industry
Commencement: December 2006
Completed: May 2008
The study examines the potential for services trade between India and Brazil in MERCOSUR and India and South Africa in SACU. It points to synergies between India and Brazil in a number of services. These include: IT and IT-enabled services (ITES), IT education, construction, entertainment, R&D services, legal services and air transport services. IT-related services also have considerable opportunities for bilateral trade between India and Argentina. As far as India and South Africa are concerned, the services with a high trade potential are financial services (including insurance), entertainment, IT and related services, tourism, transport, telecommunication and retail.
The report also takes note of the importance of expanding connectivity, particularly air links, between India and MERCOSUR and SACU for facilitating growth in services trade. It points out the importance of strengthening the India-Brazil-South Africa (IBSA) initiative for yielding larger payoffs in the form of expanded trade and trade links between India and MERCOSUR, and India and SACU.
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Competition Clauses in Bilateral Trade Treaties - Analysing the Issues in the Context of India’s Future Negotiating Strategy - Sanghamitra Sahu and Neha Gupta
Sponsoring Agency: Competition Commission of India
Commencement: October 2006
Completed: January 2008
This study provides an assessment of the competition provisions in free trade agreements and their relevance for India. It also explores the feasibility of including competition-related provisions in India’s future trade treaties. It has mostly relied on secondary literature. However, to understand the effectiveness and impact of these provisions, intensive discussions were held with academicians and key government officials from Government of India, Government of Singapore and Competition Commission of Singapore.
The analysis suggests that the trade agreements generally fall into two broad categories: EU style and US style agreements. The EU style agreements place greater importance on cooperative mechanisms for enforcement activities and technical assistance while the US style agreements are oriented towards substantive rules on transparency, monopolies, and state enterprises. The study suggests that India could benefit by including competition provisions in the trade agreements with developed countries through technical assistance and cooperation mechanism provisions.
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Emerging Asian Regionalism – Ten years after the Asian Financial Crisis – South Asian Integration Prospects and Lessons from East Asia - Ramesh Chandra and Rajiv Kumar
The objective of this paper is to assess the prospects of cooperation in South Asian economies and to draw lessons from East Asian regional experiments for South Asian regionalism. The study was presented at an ADB workshop in Bangkok on 19-20 July 2007.
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Non-Tariff Barriers: India’s Trade with Pakistan - Nisha Taneja
The study focused on non-tariff barriers faced by exporters in India and Pakistan. A working definition of non-tariff barriers adopted included six major categories, namely, quantitative restrictions, trade facilitation and customs procedures, technical barriers to trade and sanitary and phytosanitary measures, financial measures, para-tariff measures and visas. The study was based on an extensive survey conducted in several cities in India and Pakistan.
It found that even though the two countries have liberalized their import regimes, Pakistan continues to follow a positive list approach towards Indian imports. It identified the ways in which this policy impedes India’s exports and recommends the dismantling of the positive list and identified problems related to transportation, custom procedures, rules of origin certification and valuation and suggests measures to address them.
The imposition and application of standards in India was perceived as a major non-tariff barrier by Pakistani exporters. The study found that even though the TBT and SPS measures are not discriminatory, Pakistani exports to India are affected by these measures because the two most important items in which Pakistan has an export interest are textiles and agricultural products. It is these items where import restrictions/ standards are most rigorously applied by India. It also found that India and Pakistan follow an extremely restrictive visa regime. As a result only selected traders have access to trade related information. Thus lack of transparency, market imperfections and information asymmetries of this kind raise transaction costs and restrict market access for several other aspiring traders.
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Revitalizing SAARC Trade - Aparna Sawhney and Nisha Taneja
This study identifies barriers to intra-SAARC trade and suggests measures that India can take to rejuvenate it. Based on existing studies and prevalent trade policies, it provides an analytical framework for identifying barriers to intra-SAARC trade. Some of the barriers identified in the study relate to para-tariffs, negative lists under SAFTA, prevalence of specific duties in the textile sector, transport infrastructure, testing facilities at the border, port-specific entry restrictions and the regulatory regime for imports.
The study recommends that India adopt unilateral liberalization to signal its commitment to the regional integration process and also to dispel uncertainty among its SAARC trading partners. By addressing the barriers to goods liberalization India could regain the trust of other Member countries - a precondition for any further widening and deepening of the integration process in South Asia.
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Indo-US Trade in Services - Prospect of the ICT sector under a possible Free Trade Agreement - Arpita Mukherjee, Paramita Deb Gupta and Prerna Ahuja
This study examined the possibilities of enhancing trade between India and the U.S. in the ICT sector if the two countries enter into an FTA. Four sector studies were conducted: telecommunication services, audio-visual services, IT-enabled services/BPO services and software services.
The sector studies were based on secondary data analysis and interview of Indian and US companies operating in each others’ market. Each sector study analysed the recent trends and developments in the sector in the US and India, discussed the pattern of India-US trade, identified the trade barriers and suggested how these can be removed/reduced if the two countries enter into an FTA. These studies found that India and the U.S. have significant trade complementarities in the ICT sector which should become a priority sector in the FTA negotiations.
Various other areas of Indo-US collaboration were also identified. Although there are no major market access barriers, Indian companies are facing domestic regulation related barriers in the US which can be raised under an FTA. The study emphasised the need for reforms in these sectors to improve global competitiveness and enable India to gain from bilateral liberalization.
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