Environmental Impact of India's Trade Liberalization

Gamper-Rabindran, Shanti; Jha, Shreyasi

doi:10.2139/ssrn.574161

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Environmental Impact of India's Trade Liberalization

42 Pages Posted: 10 Aug 2004

See all articles by Shanti Gamper-Rabindran

Shanti Gamper-Rabindran

University of North Carolina (UNC) at Chapel Hill - Department of Public Policy

Shreyasi Jha

Human Development Report Office, UNDP

Date Written: June 2004

Abstract

India's liberalization program of 1991 reduced trade barriers and removed investment restrictions across industries. Using industry level dataset aggregated across all manufacturing industries, we compare the pre- and post-liberalization periods to examine if India's domestic production and exports showed a greater increase in dirty industries relative to cleaner ones. We also examine whether there has been a greater inflow of FDI into pollution-intensive sectors in the post-liberalization period. Our findings indicate that exports and FDI grew in the more polluting sectors relative to the less polluting sectors in the post-liberalization period.

Keywords: Environment, pollution, trade liberalization, India

JEL Classification: F14, F18, F21, O53, O24, Q56

Suggested Citation: Suggested Citation

Gamper-Rabindran, Shanti and Jha, Shreyasi, Environmental Impact of India's Trade Liberalization (June 2004). Available at SSRN: https://ssrn.com/abstract=574161 or http://dx.doi.org/10.2139/ssrn.574161