An Empirical Analysis of India-ASEAN Trade Dynamics

Abstract

The export and import intensity index and bilateral revealed comparative advantage (BRCA) index were used to analyze India-ASEAN trade from 1997 to 2020. The study further explored variables in facilitating India-ASEAN trade by applying the gravity trade model of exports and imports. Results showed that Indian-ASEAN bilateral trade was more intense in exports than imports. India enjoyed a competitive advantage in agriculture and related products in 1997 and manufactured products in 2020. The exports of India to ASEAN exhibited minor structural changes from 1997 to 2020. In gravity model analysis, exports and import flows were mainly explained by trading partners' GDP and trade openness. Exports increased while imports decreased with per capita GDP. Trade cost negatively impacted export and import flows in the model.