Preferential Trading in South Asia
The authors examine the economic case for the South Asia Free Trade Area (SAFTA) Agreement signed on January 6, 2004 by India, Pakistan, Bangladesh, Sri Lanka, Nepal, Bhutan, and the Maldives. They start with a detailed analysis of the preferential trading arrangements in South Asia to look at the r...
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| Format: | Policy Research Working Paper |
| Language: | English |
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World Bank, Washington, DC
2012
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| Online Access: | http://documents.worldbank.org/curated/en/2006/01/6541034/preferential-trading-south-asia http://hdl.handle.net/10986/8822 |
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okr-10986-8822 |
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| recordtype |
oai_dc |
| repository_type |
Digital Repository |
| institution_category |
Foreign Institution |
| institution |
Digital Repositories |
| building |
World Bank Open Knowledge Repository |
| collection |
World Bank |
| language |
English |
| topic |
ACCORD AD VALOREM AGRICULTURE ANTI-TRADE APPAREL APPAREL EXPORTS APPAREL PRODUCTS BILATERAL AGREEMENTS BILATERAL IMPORTS BILATERAL INITIATIVES BILATERAL TRADE COMPARATIVE ADVANTAGE CONCESSIONS CUSTOMS CUSTOMS CLASSIFICATION CUSTOMS DUTIES DEVELOPMENT STRATEGY DIFFERENTIAL TREATMENT DUTY-FREE ACCESS ECONOMIC COMMUNITY ECONOMIC COOPERATION ECONOMIC SIZE ECONOMIC UNION ECONOMIC WELFARE EXPANSION OF TRADE EXPORTING COUNTRY EXPORTS EXTERNAL LIBERALIZATION EXTRA-REGIONAL TRADE FREE ACCESS FREE TRADE FREE TRADE AGREEMENT FREE TRADE AREA GDP HARMONIZATION IMPACT OF TRADE IMPORT DUTIES IMPORT TARIFFS IMPORT VALUE IMPORT-SUBSTITUTION POLICIES IMPORTED INPUTS IMPORTING COUNTRIES IMPORTING COUNTRY INDIRECT TAXES INDUSTRIALIZATION INTERMEDIATE INPUTS INTERNAL LIBERALIZATION INTERNATIONAL TRADE INTRA-REGIONAL IMPORTS INTRA-REGIONAL TRADE INTRAREGIONAL TRADE LDCS LIBERALIZING TRADE LOCAL CONTENT LOCAL INPUTS MEMBER COUNTRIES MEMBER COUNTRY MEMBER STATE MEMBER STATES MFN TARIFFS MINISTERIAL MEETING MOST FAVORED NATION MULTILATERAL CONTEXT NONDISCRIMINATORY LIBERALIZATION OPEN TRADE PARTNER COUNTRIES PARTNER COUNTRY PER CAPITA INCOMES POLICY MAKERS POLICY RESEARCH POLITICAL ECONOMY POLITICAL FACTORS POTENTIAL BENEFITS PREFERENTIAL BASIS PREFERENTIAL TARIFF PREFERENTIAL TARIFFS PREFERENTIAL TRADE PREFERENTIAL TRADE AGREEMENTS PREFERENTIAL TRADE AREA PREFERENTIAL TRADE ARRANGEMENTS PREFERENTIAL TRADING PREFERENTIAL TRADING ARRANGEMENTS PREFERENTIAL TREATMENT PRICE EFFECTS PRICE REDUCTIONS PRIVATE SECTOR PRODUCTION STRUCTURE PROTECTION LEVELS QUANTITATIVE RESTRICTIONS QUOTA IMPORTS REGIONAL ARRANGEMENT REGIONAL COOPERATION REGIONAL PARTNERS REGIONAL TRADE REGIONALISM RULES OF ORIGIN SOUTH ASIAN TARIFF CONCESSIONS TARIFF LINES TARIFF PREFERENCES TARIFF RATE TARIFF RATE QUOTA TARIFF RATES TARIFF REVENUE TARIFF-RATE QUOTA TERMS OF TRADE TRADE AGREEMENT TRADE AGREEMENTS TRADE BARRIERS TRADE BLOCS TRADE CREATION TRADE DEFLECTION TRADE DIVERSION TRADE EXPANSION TRADE FACILITATION TRADE FLOWS TRADE MORE TRADE NEGOTIATIONS TRADE POLICIES TRADE PREFERENCES TRADE REGIME TRADE REGIMES TRADE RELATIONS UNILATERAL LIBERALIZATION UNILATERAL TRADE UNILATERAL TRADE LIBERALIZATION VOLUME OF TRADE WORLD MARKETS WORLD PRICE WORLD TRADE WTO ZERO TARIFFS |
| spellingShingle |
ACCORD AD VALOREM AGRICULTURE ANTI-TRADE APPAREL APPAREL EXPORTS APPAREL PRODUCTS BILATERAL AGREEMENTS BILATERAL IMPORTS BILATERAL INITIATIVES BILATERAL TRADE COMPARATIVE ADVANTAGE CONCESSIONS CUSTOMS CUSTOMS CLASSIFICATION CUSTOMS DUTIES DEVELOPMENT STRATEGY DIFFERENTIAL TREATMENT DUTY-FREE ACCESS ECONOMIC COMMUNITY ECONOMIC COOPERATION ECONOMIC SIZE ECONOMIC UNION ECONOMIC WELFARE EXPANSION OF TRADE EXPORTING COUNTRY EXPORTS EXTERNAL LIBERALIZATION EXTRA-REGIONAL TRADE FREE ACCESS FREE TRADE FREE TRADE AGREEMENT FREE TRADE AREA GDP HARMONIZATION IMPACT OF TRADE IMPORT DUTIES IMPORT TARIFFS IMPORT VALUE IMPORT-SUBSTITUTION POLICIES IMPORTED INPUTS IMPORTING COUNTRIES IMPORTING COUNTRY INDIRECT TAXES INDUSTRIALIZATION INTERMEDIATE INPUTS INTERNAL LIBERALIZATION INTERNATIONAL TRADE INTRA-REGIONAL IMPORTS INTRA-REGIONAL TRADE INTRAREGIONAL TRADE LDCS LIBERALIZING TRADE LOCAL CONTENT LOCAL INPUTS MEMBER COUNTRIES MEMBER COUNTRY MEMBER STATE MEMBER STATES MFN TARIFFS MINISTERIAL MEETING MOST FAVORED NATION MULTILATERAL CONTEXT NONDISCRIMINATORY LIBERALIZATION OPEN TRADE PARTNER COUNTRIES PARTNER COUNTRY PER CAPITA INCOMES POLICY MAKERS POLICY RESEARCH POLITICAL ECONOMY POLITICAL FACTORS POTENTIAL BENEFITS PREFERENTIAL BASIS PREFERENTIAL TARIFF PREFERENTIAL TARIFFS PREFERENTIAL TRADE PREFERENTIAL TRADE AGREEMENTS PREFERENTIAL TRADE AREA PREFERENTIAL TRADE ARRANGEMENTS PREFERENTIAL TRADING PREFERENTIAL TRADING ARRANGEMENTS PREFERENTIAL TREATMENT PRICE EFFECTS PRICE REDUCTIONS PRIVATE SECTOR PRODUCTION STRUCTURE PROTECTION LEVELS QUANTITATIVE RESTRICTIONS QUOTA IMPORTS REGIONAL ARRANGEMENT REGIONAL COOPERATION REGIONAL PARTNERS REGIONAL TRADE REGIONALISM RULES OF ORIGIN SOUTH ASIAN TARIFF CONCESSIONS TARIFF LINES TARIFF PREFERENCES TARIFF RATE TARIFF RATE QUOTA TARIFF RATES TARIFF REVENUE TARIFF-RATE QUOTA TERMS OF TRADE TRADE AGREEMENT TRADE AGREEMENTS TRADE BARRIERS TRADE BLOCS TRADE CREATION TRADE DEFLECTION TRADE DIVERSION TRADE EXPANSION TRADE FACILITATION TRADE FLOWS TRADE MORE TRADE NEGOTIATIONS TRADE POLICIES TRADE PREFERENCES TRADE REGIME TRADE REGIMES TRADE RELATIONS UNILATERAL LIBERALIZATION UNILATERAL TRADE UNILATERAL TRADE LIBERALIZATION VOLUME OF TRADE WORLD MARKETS WORLD PRICE WORLD TRADE WTO ZERO TARIFFS Baysan, Tercan Panagariya, Arvind Pitigala, Nihal Preferential Trading in South Asia |
| geographic_facet |
South Asia |
| relation |
Policy Research Working Paper; No. 3813 |
| description |
The authors examine the economic case for the South Asia Free Trade Area (SAFTA) Agreement signed on January 6, 2004 by India, Pakistan, Bangladesh, Sri Lanka, Nepal, Bhutan, and the Maldives. They start with a detailed analysis of the preferential trading arrangements in South Asia to look at the region's experience to date and to draw lessons. Specifically, they examine the most effective free trade area in existence-the India-Sri Lanka Free Trade Area-and evaluate the developments under the South Asian Preferential Trade Area (SAPTA). The authors conclude that, considered in isolation, the economic case for SAFTA is weak. When compared with the rest of the world, the region is tiny both in terms of economic size as measured by GDP (and per capita incomes) and the share in world trade. It is argued that these facts make it unlikely that trade diversion would be dominant as a result of SAFTA. This point is reinforced by the presence of high levels of protection in the region and the tendency of the member countries to establish highly restrictive "sectoral exceptions and sensitive lists" and stringent "rules of origin." The authors argue that the SAFTA makes sense only in the context of a much broader strategy of creating a larger preferential trade area in the region that specifically would encompass China and the member nations of the Association of South East Asian Nations. In turn, the case for the latter is strategic: the pursuit of regionalism in the Americas and Europe has created increasing discrimination against Asian exports to those regions, which must inevitably affect the region's terms of trade adversely. An Asian bloc could be a potential instrument of changing incentives for the trade blocs in the Americas and Europe and forcing multilateral freeing of trade. Assuming that the SAFTA Agreement is here to stay, the authors suggest steps to ensure that the Agreement can be made more effective in promoting intra-regional trade, while minimizing the likely trade-diversion costs and maximizing the potential benefits. |
| format |
Publications & Research :: Policy Research Working Paper |
| author |
Baysan, Tercan Panagariya, Arvind Pitigala, Nihal |
| author_facet |
Baysan, Tercan Panagariya, Arvind Pitigala, Nihal |
| author_sort |
Baysan, Tercan |
| title |
Preferential Trading in South Asia |
| title_short |
Preferential Trading in South Asia |
| title_full |
Preferential Trading in South Asia |
| title_fullStr |
Preferential Trading in South Asia |
| title_full_unstemmed |
Preferential Trading in South Asia |
| title_sort |
preferential trading in south asia |
| publisher |
World Bank, Washington, DC |
| publishDate |
2012 |
| url |
http://documents.worldbank.org/curated/en/2006/01/6541034/preferential-trading-south-asia http://hdl.handle.net/10986/8822 |
| _version_ |
1764405775501885440 |
| spelling |
okr-10986-88222021-04-23T14:02:40Z Preferential Trading in South Asia Baysan, Tercan Panagariya, Arvind Pitigala, Nihal ACCORD AD VALOREM AGRICULTURE ANTI-TRADE APPAREL APPAREL EXPORTS APPAREL PRODUCTS BILATERAL AGREEMENTS BILATERAL IMPORTS BILATERAL INITIATIVES BILATERAL TRADE COMPARATIVE ADVANTAGE CONCESSIONS CUSTOMS CUSTOMS CLASSIFICATION CUSTOMS DUTIES DEVELOPMENT STRATEGY DIFFERENTIAL TREATMENT DUTY-FREE ACCESS ECONOMIC COMMUNITY ECONOMIC COOPERATION ECONOMIC SIZE ECONOMIC UNION ECONOMIC WELFARE EXPANSION OF TRADE EXPORTING COUNTRY EXPORTS EXTERNAL LIBERALIZATION EXTRA-REGIONAL TRADE FREE ACCESS FREE TRADE FREE TRADE AGREEMENT FREE TRADE AREA GDP HARMONIZATION IMPACT OF TRADE IMPORT DUTIES IMPORT TARIFFS IMPORT VALUE IMPORT-SUBSTITUTION POLICIES IMPORTED INPUTS IMPORTING COUNTRIES IMPORTING COUNTRY INDIRECT TAXES INDUSTRIALIZATION INTERMEDIATE INPUTS INTERNAL LIBERALIZATION INTERNATIONAL TRADE INTRA-REGIONAL IMPORTS INTRA-REGIONAL TRADE INTRAREGIONAL TRADE LDCS LIBERALIZING TRADE LOCAL CONTENT LOCAL INPUTS MEMBER COUNTRIES MEMBER COUNTRY MEMBER STATE MEMBER STATES MFN TARIFFS MINISTERIAL MEETING MOST FAVORED NATION MULTILATERAL CONTEXT NONDISCRIMINATORY LIBERALIZATION OPEN TRADE PARTNER COUNTRIES PARTNER COUNTRY PER CAPITA INCOMES POLICY MAKERS POLICY RESEARCH POLITICAL ECONOMY POLITICAL FACTORS POTENTIAL BENEFITS PREFERENTIAL BASIS PREFERENTIAL TARIFF PREFERENTIAL TARIFFS PREFERENTIAL TRADE PREFERENTIAL TRADE AGREEMENTS PREFERENTIAL TRADE AREA PREFERENTIAL TRADE ARRANGEMENTS PREFERENTIAL TRADING PREFERENTIAL TRADING ARRANGEMENTS PREFERENTIAL TREATMENT PRICE EFFECTS PRICE REDUCTIONS PRIVATE SECTOR PRODUCTION STRUCTURE PROTECTION LEVELS QUANTITATIVE RESTRICTIONS QUOTA IMPORTS REGIONAL ARRANGEMENT REGIONAL COOPERATION REGIONAL PARTNERS REGIONAL TRADE REGIONALISM RULES OF ORIGIN SOUTH ASIAN TARIFF CONCESSIONS TARIFF LINES TARIFF PREFERENCES TARIFF RATE TARIFF RATE QUOTA TARIFF RATES TARIFF REVENUE TARIFF-RATE QUOTA TERMS OF TRADE TRADE AGREEMENT TRADE AGREEMENTS TRADE BARRIERS TRADE BLOCS TRADE CREATION TRADE DEFLECTION TRADE DIVERSION TRADE EXPANSION TRADE FACILITATION TRADE FLOWS TRADE MORE TRADE NEGOTIATIONS TRADE POLICIES TRADE PREFERENCES TRADE REGIME TRADE REGIMES TRADE RELATIONS UNILATERAL LIBERALIZATION UNILATERAL TRADE UNILATERAL TRADE LIBERALIZATION VOLUME OF TRADE WORLD MARKETS WORLD PRICE WORLD TRADE WTO ZERO TARIFFS The authors examine the economic case for the South Asia Free Trade Area (SAFTA) Agreement signed on January 6, 2004 by India, Pakistan, Bangladesh, Sri Lanka, Nepal, Bhutan, and the Maldives. They start with a detailed analysis of the preferential trading arrangements in South Asia to look at the region's experience to date and to draw lessons. Specifically, they examine the most effective free trade area in existence-the India-Sri Lanka Free Trade Area-and evaluate the developments under the South Asian Preferential Trade Area (SAPTA). The authors conclude that, considered in isolation, the economic case for SAFTA is weak. When compared with the rest of the world, the region is tiny both in terms of economic size as measured by GDP (and per capita incomes) and the share in world trade. It is argued that these facts make it unlikely that trade diversion would be dominant as a result of SAFTA. This point is reinforced by the presence of high levels of protection in the region and the tendency of the member countries to establish highly restrictive "sectoral exceptions and sensitive lists" and stringent "rules of origin." The authors argue that the SAFTA makes sense only in the context of a much broader strategy of creating a larger preferential trade area in the region that specifically would encompass China and the member nations of the Association of South East Asian Nations. In turn, the case for the latter is strategic: the pursuit of regionalism in the Americas and Europe has created increasing discrimination against Asian exports to those regions, which must inevitably affect the region's terms of trade adversely. An Asian bloc could be a potential instrument of changing incentives for the trade blocs in the Americas and Europe and forcing multilateral freeing of trade. Assuming that the SAFTA Agreement is here to stay, the authors suggest steps to ensure that the Agreement can be made more effective in promoting intra-regional trade, while minimizing the likely trade-diversion costs and maximizing the potential benefits. 2012-06-22T19:07:22Z 2012-06-22T19:07:22Z 2006-01 http://documents.worldbank.org/curated/en/2006/01/6541034/preferential-trading-south-asia http://hdl.handle.net/10986/8822 English Policy Research Working Paper; No. 3813 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank World Bank, Washington, DC Publications & Research :: Policy Research Working Paper Publications & Research South Asia |