Trade in Services in Asia-Pacific Assessing Barriers and Implications for Services Trade Facilitation in India
“Trade in Services in Asia Pasific: Assessing Barriers and Implications for Services Trade Facilitation in India”, in Celebrating the Third Decade and Beyond: New Challenges to ASEAN-India Economic Partnership, (Ed.) by Prabir De and Suthiphand Chirathivat, KW Publishers, New Delhi. (2016)
Posted: 12 Nov 2016
Date Written: November 6, 2016
This paper attempts to examine the determinants of services export and its barriers to trade. We have looked at the cross-country experiences in developing economies of Asia-Pacific such as ASEAN and SAARC, in general, and India, in particular. Our objective is to understand the macro perspective of performances of services export and also whether the supply side barriers such as the infrastructure facilities that facilitate services trade have an effect on the growth of services export in developing economies of Asia-Pacific. We find that ASEAN region has a high potential to benefit from the services export, given that services trade facilitation index (STFI) and institution index is positively promoting services export and also ASEAN reacts favorably towards world import of services. The study suggests that SAARC has to emphasis on infrastructure development that facilitates the services export. In case of India, we find that STFI is negative and insignificant for total services. However, when services export is disaggregated, STFI is negative but significant for financial, transportation and travel services, which suggest that improved service trade facilitation would help unlock the unrealized trade potential in these sectors. In case of computer and information technology services, our estimated models indicate that STFI has been facilitating services export from India.
Keywords: India, Services Trade, Service Trade Facilitation Index, Trade Barriers, Gravity Model
JEL Classification: F13, F18
Suggested Citation: Suggested Citation