Economic bridges, despite their geographical proximity and bilateral free trade agreements and multilateral (FTA), South Asia is one of the most economically integrated regions in the world.
Because of protectionist policies, high logistics costs, lack of political will and a wider deficit of trust, intra-regional trade in South Asia is far below its potential equal to 5% of global trade in the region.
This makes South Asia one of the most disconnected areas of the world, especially when compared to other regions such as East Asia and the Pacific, where intra-regional trade accounts for about 50% of total trade.
Sub-Saharan Africa, where intra-regional trade has increased over the years to 22% due to steps taken by the government to create a transparent mechanism for trade facilitation.
intra-regional trade in South Asia (including Myanmar) only reached 5.6% (2017).
At that time grew increasingly concerned about China’s economic and strategic ties in the region, India lost “costless” trick. As the figure shows can trade more in the region, in terms of both exports and imports. This piece focuses on India’s imports from South Asia, due to the larger economy and a more sophisticated usually open their markets before trading partners they are smaller and less developed to make.
As a result, the former providing the latter with the “early harvest”.
India can take any steps to follow liberalization, and try to increase its $ 4.6 billion in imports from South Asia?Incidentally, exports to the region were $ 24.6 billion.So how “Can-India-import-over-from-South-Asia” becomes a valid question? It becomes valid when there are artificial barriers to trade, which affects one set more than any other country.
Indian trade regime discriminates against other countries of South Asia:(Economic bridges)
As the pointed out in the report of the World Bank – A Glass Half Full: The Promise Regional Trade in South Asia.
Trade restrictions overall index was developed in the report is 2-9 times higher for India, Nepal, Sri Lanka and Pakistan imported from South Asia of imports from all over the world.
This is also reflected in the calculation of the potential for intra-regional trade in goods, which is estimated at US $ 67 billion compared to actual trading $ 23 billion in 2015.
India should focus on three broad sets of measures to encourage imports from South Asia:
One, encourage the Indian private sector to invest more in the neighborhood.
It may be a long-term measure with the highest prize for both India and its neighbors.
Trade and investment are inextricably linked, particularly in the form of cross-border value chains.
By investing in neighboring countries, Indian companies can help accelerate the regional value chain, which would increase regional trade in parts and components.
these opportunities may arise in sectors such as IT services, tourism, spices, garments, leather products, agricultural products, only a few names.
Likewise, firms from neighboring countries can invest in India, to create the same positive impact on trade and regional value chains.
Two, continue to improve the hardware and software infrastructure that allows trade and investment.
The costs of trade between the countries in South Asia are very high.
The average trading costs between partner countries in South Asia are 20 percent higher than the partners in the ASEAN countries and cheaper for India to trade with Brazil than with Pakistan. To address this, India can expedite border posts
other articles related to Gs paper3