Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/101267 
Year of Publication: 
2014
Series/Report no.: 
ADBI Working Paper No. 465
Publisher: 
Asian Development Bank Institute (ADBI), Tokyo
Abstract: 
This paper examines the gains for South Asian economies from integrating with East Asia and India's role in this process. Evidence of increased pan-Asian integration exists but the process is uneven. Bilateral trade has grown. Bilateral foreign direct investment flows and free trade agreements (FTAs) have also increased, albeit at a slower pace than trade. The integration process has been led by India and Pakistan with limited participation of smaller South Asian economies. Tackling key impediments in cross-border infrastructure, FTAs, trade barriers and business regulations, and barriers to services will foster further integration. Computable general equilibrium (CGE) simulations suggest that a South Asia-East Asia FTA offers the most gains for South Asia and that India has an incentive to include its neighbors in such an arrangement rather than going it alone with East Asia. The rest of South Asia will gain by deepening South Asian integration and fostering ties with East Asia.
Subjects: 
pan-asian economic integration
south asia-east asia trade
infrastructure
reforms
free trade agreements
JEL: 
F15
F17
O14
O24
O53
Document Type: 
Working Paper

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