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Accepted Manuscript

Title: IndiaASEAN Free Trade Agreement: An Ex Post


Evaluation
Author: Ranajoy Bhattacharyya Avijit Mandal
PII:
DOI:
Reference:

S0161-8938(16)00011-9
http://dx.doi.org/doi:10.1016/j.jpolmod.2016.02.001
JPO 6254

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Journal

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Revised date:
Accepted date:

30-9-2015
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Policy

Modeling

Please cite this article as: Bhattacharyya, R., and Mandal, A.,IndiandashASEAN
Free Trade Agreement: An Ex Post Evaluation, Journal of Policy Modeling (2016),
http://dx.doi.org/10.1016/j.jpolmod.2016.02.001
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Ranajoy Bhattacharyya

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IndiaASEAN Free Trade Agreement: An Ex Post Evaluation

Indian Institute of Foreign Trade, Kolkata

J-1/14, EP & GP Block, Sector-V, Salt Lake City

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Kolkata 700091

Email: ranajoy@iift.ac.in, Ph: 91-33-2357 2854 (Extn. 133)

Fax: 91-33-23572855.

Avijit Mandal*

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Maulana Azad College, Kolkata

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8, Rafi Ahmed Kidwai Road


Kolkata 700013

Email: mandal.avijit58@gmail.com, Ph: 91-33-2334-3046

* Corresponding Author

Acknowledgements: We are indebted to T P Ghosh for his comments and suggestions in


section

of

this

paper.

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IndiaASEAN Free Trade Agreement: An Ex Post Evaluation

Abstract

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Ex post effects of the IndiaASEAN Free Trade Agreement reveal that Indias balance of trade
with ASEAN has deteriorated and there is a weak correspondence between tariff reforms and

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trade expansion. The aggregate value of the net surplus with the government after taxing gainers

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and subsidizing losers was positive up to 2012 but has been declining ever since and became
negative 2013 as trade with the rest of the world has fallen for both India as well as ASEAN

owing to the global slowdown. We show that had the slowdown not been there the surplus would
always have been positive for India. We also propose two alternative policy scenarios where the

surplus would always have been positive: an FTA with rest of the world and a schedule where

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tariff elastic goods were given priority.

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Keywords: Partial reform of tariff, free trade agreement, compensation principle, India,
ASEAN

JEL Classification: F13, F15

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The IndiaASEAN Free Trade Agreement: An Ex Post

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Evaluation
1. Introduction

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Indias economic engagement with ASEAN began with Indias Look East Policy of 1991.
There was rapid progress thereafter: India became a partial dialogue partner of ASEAN in 1992,

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full dialogue partner in 1995, summit-level partner in 2002, and it signed a framework agreement

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on comprehensive economic cooperation along with a free trade agreement (FTA) for a limited
number of goods with Thailand in 2003. The FTA with ASEAN in 2009 was the culmination of

this effort toward complete trade integration with the ASEAN region.
Negotiations before the agreement were long and tortuous. More than 15 meetings of the

trade negotiations committee were required to reach a consensus on the tariff-reduction schedule.

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Eventually, India gave a single set of tariff offers to nine of the ASEAN countries and a separate

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offer to the Philippines. All ASEAN countries gave separate offers to India except Singapore,
with whom India has had zero tariff rates since 2005. Each of these offers consist of individual
tariff-reduction schedules on about 9700 tariff lines according to the Harmonized System (HS) 8digit level.

The FTA generated considerable interest among researchers, especially in India. The
research yielded useful insights on the scenario that is likely to emerge owing to the signing of
the agreement. For example Pal and Dasgupta (2008) highlighted significant complementarities
between Indias service-oriented economy and ASEANs light manufacturingdriven economy.
Pal and Dasgupta (2009) argued that in the short run, India will benefit from the agreement, but

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various sectors like plantation commodities, textiles, auto components would likely face
competition from their ASEAN counterparts. Bhattacharyya and Mandal (2010) estimated that
Indias balance of trade will deteriorate with most ASEAN countries because of the agreement.

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Francis (2011) concluded that several semi-processed or processed agricultural products will be
adversely affected by this deal. However, tariff liberalization will lead to Indias deeper

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integration in production networking. Bhattacharyya and Mandal (2014) estimated the effect of

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debated ones, will be unaffected by the agreement.

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the agreement on all six-digit industries and concluded that most of them, including the most

On welfare, it was concluded that although welfare for both parties is likely to increase

owing to the agreement, ASEAN is expected to benefit more than India (Ahmed [2010]; Nag and
Sikdar [2011]). At the industry level, it was observed that while the fishery (Chandran and

Sudarsan [2012]) and plantation sectors (Veeramani and Saini [2011]) would likely benefit from

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the agreement, the tea sector (Nagoor and Kumar [2010]) may be adversely affected.

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The entire literature on the agreement is conjectural in nature, focusing on the likely impact
of the agreement on the economy and particular industries within it. However, four years have
elapsed since the implementation of the agreement. Trade and tariff data of the countries
concerned for these years can now be accessed from the World Integrated Trade Solution
(WITS) website of the UN1. In this study, we use this data to assess the actual benefits accrued
by India and ASEAN in these four years. In particular, we highlight four issues in this paper: the
magnitude and the nature of the progress in tariff reduction, actual impact on trade and how the

The tariff data was generated by applying the tariff-reduction schedule of each tariff line for each pair of countries
to the 2007 tariff data between the countries. The tariff-concession schedules follow two classifications: HS 2002
and HS 2007. HS 2002 and 2007 comprise 5220 products 238 products, respectively. Because the import data for
Brunei and Laos in 2010 and Laos, Myanmar, and Vietnam in 2013 are not available in WITS, we have replaced
them with Indias export data.

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changes in imports are related to tariff changes, the impact on welfare thus far and finally, the
policy options open to India given our findings.

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The rest of the paper is arranged as follows. Section 2 describes the nature of the agreement.
Section 3 deals with the actual changes in the tariff structure thus far. Sections 4 and 5 highlight

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the effect of the agreement on trade and welfare. In section 6 we discuss the policy options
available to the government of India given the effects of the agreement so far. Finally section 7

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concludes the paper.

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2. Nature of Agreement

The agreement divides tariff lines into five subgroups, four of which are as follows: Normal

Tracks 1 & 2, Sensitive Track, and Exclusion List. The fifth subgroup is different for India and

for ASEAN. For India, the fifth subgroup is called Special Product, while for ASEAN, the

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fifth subgroup is called Highly Sensitive List. For the normal tracks, tariffs are being reduced
to zero in a phased manner by 2016. However, the pace of tariff reduction is higher for the first

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normal track than that for the second. Tariffs for products under the sensitive track will be
reduced to 5%. For the exclusion list there is no reduction in tariff. For special products and
products under the highly sensitive list, the tariff reduction is between 5% and 55%.
At the time of implementation of the FTA, Indias average tariff to ASEAN countries (13%)
was much higher than ASEAN countries tariffs to India (8.2%). Hence, with the FTA in place,
India will have to reduce tariffs at a faster pace than the ASEAN countries. This trend is apparent
from Table 1, whether we consider the simple average of tariffs across commodities or the
import weighted average2. Because the magnitudes of the offers fall when we consider the
2

The simple average country j is calculated as`:

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weighted average rather than the simple average, all countries have made higher offers for goods
in which trade is relatively low. This is more so for the ASEAN countries than for India.
Thailand has made the highest offer to India among the ASEAN countries. The less

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developed and new ASEAN members such as Laos and Cambodia have made the lowest offers.
India has extended a single offer to all ASEAN countries except Philippines, and the offer to

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Philippines is substantially lower than that to the rest of the ASEAN countries.

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Table 2 shows that the reduction schedule implies an inverted duty structure, where the pace
of reduction for final goods is significantly greater than that for intermediate goods and raw

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materials. The inverted duty structure is not observed in the base year 2007 for oilseeds, fats &
oils, and textiles; however, these goods do face an inverted duty structure in the latter phase of

tariff reduction (2012 and 2016). The highest inverted duty structure is observed in two

industries: beverages & tobacco and dairy products.

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3. Extent of Tariff Reduction

n t ij t ij / t ij
base
i 1 base final

ij

ij

Where t base is the base year tariff of commodity (at HS 6 digit) i and t final is the final year tariff for i. n indicates
the number of tariff lines. The import weighted average is calculated as:
n

ij
ij
ij
ij
ij

Imp
/

base Imp base t base t final / t base

i 1
i 1

Where Imp

ij
base

is the import of the ith product in the base period for the jth country, and

Imp

ij
base

represents

i 1

the total imports of j. Note that if the simple (weighted) average is greater than the weighted (simple) average, more
offers have been given on goods that have large trade volumes. See Ghosh et al (2016).

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Table 3 summarizes the levels of tariff reductions. Note that given the offer structure, tariffs
will have to be eliminated by 2013 for products under normal tracks between India and ASEAN
5 (Brunei, Indonesia, Malaysia, and Thailand).3 Table 3 reflects this fact. As per the offer

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schedules, the pace of tariff reduction is much slower for Cambodia-Laos-Myanmar-Vietnam


(CLMV) countries compared with the ASEAN 5 countries. Therefore, their average tariffs have

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reduced the least. The lowest decrease is for Myanmar across tracks. With average tariffs of

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10.6% and 7.2%, respectively, Thailand and Malaysia had the highest average tariffs in 2007
among the ASEAN 5 countries. Hence, their declines are the highest.4 India had the highest

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average base tariff in 2007 (12.6 percent). Since its rank is third in terms of tariff reductions, the
pace of reduction for India is clearly slower than that for Thailand and Malaysia.

By 2014, India had eliminated tariffs in 2168 of the 5458 tariff lines of the 6-digit HS.

However, no major industry is fully represented in this set. For India, capital and durable goods,

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especially in the non-electrical machinery industry, have experienced maximum tariff declines.
Tariffs have reduced by 100% in as many as 445 6-digit HS products from the non-electrical

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machinery industry. Primary goods such as wood and paper also experienced steep declines. The
lowest declines were in passenger motor cars and household consumption goods such as
beverages & tobacco, oilseeds & fat, coffee & tea, and dairy products.
For ASEAN, because the CLMV countries have been allowed to reduce tariffs at a much
slower pace, no product has seen a 100% tariff reduction. For ASEAN 5, only six 6-digit HS
products have experienced 100% tariff reduction. Therefore, Indias pace of decline in the initial
period was much higher than that of ASEAN. In 2014, Indias average tariff was 6.2% compared

Note that Singapores tariff to India was already zero in 2007.


Of all ASEAN members, only Cambodia and Vietnam have higher average tariffs. However, their pace of tariff
reduction is much slower than that of the ASEAN 5 countries.

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to ASEANs 5.2%. The gap in average tariff between India and the ASEAN has thus almost been
eliminated in the first five years of the agreement.
ASEANs steepest tariff declines were in roughly the same category of products as that of

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India. Non-electrical machinery, wood & paper, and manufactures not elsewhere specified rank
high in terms of tariff reduction for both parties. The only exception seems to be the

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confectionaries industry, which ranks high for ASEAN but not for India.

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4. Trade Response

First, between 2010 and 2014, Indias balance of trade has deteriorated in the aggregate

owing to deterioration of trade balance with Malaysia, Thailand, Indonesia, and Brunei (table 4).
Therefore, Indias imports from ASEAN have increased faster than ASEANs imports from

India. Are these import changes consistent with the tariff-reduction schedules? Our expectation

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is that imports will change to a greater extent for normal track products, to a lesser extent for

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sensitive track products, and to the least extent for highly sensitive products. The maximum rise
in Indias imports from ASEAN 9 is in the special product category, where tariff reduction is
very low. In case of trade with the Philippines, Indias imports have increased to a greater extent
in product lines with no reduction in tariffs. Thus, changes in import trends are unrelated to tariff
changes. In fact, the track-wise rank correlation between percentage reduction in tariff and
percentage increase in imports for India is only 0.3, while the correlation between change in
tariff and change in import is -0.44.
The same tendency is noted for ASEAN countries as well. Brunei and Indonesias
imports from India have increased more for products in the exclusion list. In the case of the
Philippines and Thailand, the maximum percentage change in imports is observed in the products
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covered under the sensitive or highly sensitive list. The sole exception here is Malaysia, where
the maximum increase in imports is observed in the normal tracks. All CLMV members, except
Vietnam, show the maximum rise in imports from India between 2007 and 2012 in ST products.

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These products are subjected to very small tariff reductions. In contrast, Vietnams imports have
increased significantly for products with no tariff reductions. The track-wise rank correlation

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between percentage reduction in tariff and percentage increase in imports for ASEAN is -0.1 and

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the correlation between track-wise change in tariff and change in import is -0.04. Therefore,

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imports have not responded to tariff changes for the ASEAN countries.

In 2010, Indias import from ASEAN (US $29496 mn) was greater than ASEANs import

from India (19784 million US $). Since India reduced tariff at a faster pace, Indias imports have
increased more (12447 million US $) than ASEAN imports (9525 million US $) in 2013. The

increase comes from primary goods such as coal, petroleum oil, copper ore, copper waste and

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scrap, and natural rubber (at the 6-digit level). Interestingly the tariffs on two of these products:

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coal and copper ore, declined sharply (63% and 50%) between 2010 and 2013, while the tariffs
on the other three products did not decline. Similarly, ASEANs aggregate import has increased
most rapidly for processed goods such as pxylene, polished diamonds, steel pipes (thickness less
than 3 mm), and cathodes and sections of cathodes. For these goods, tariff reductions between
2010 and 2013 were 8%, 9%, 14%, and 8%, respectively. In fact, the simple correlation between
the percentage tariff reduction and percentage import increase at the 6-digit HS in 2013 was
merely 0.01 for India and 0.03 for ASEAN.5

5. Effect on Welfare
5

Tables are not reported here but are available with the authors on request.

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Given that ex post welfare changes cannot be addressed through standard welfare
measurement models such as GTAP and SMART, we use an indirect approach pioneered by
Kemp and Wan (1976) (reviewed by Feenstra [2007]). At the heart of this approach is a

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compensation principle where the gainers compensate the losers through a system of lump sum
transfers. A preferential trade agreement is assumed to benefit the participating countries if the

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money available for this transfer is positive.

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To apply this method, we first need to extend the compensation principle to the case where a

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single country liberalizes trade with a set of countries who already have an FTA among
themselves. The sufficiency conditions depend crucially on trade with rest of the world. If trade

with rest of the world remains unchanged before and after the agreement, the benefits to the
members depend only on the change in tariff revenue and the corresponding sufficiency

t 0 m0 0

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t m

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the terminal period of the FTA):

condition is as follows (t is the tariff vector, m the import vector, 0 is the initial period, and 1 is

(1)

In contrast, if trade with rest of the world is not constant, the direction of that change is important
and the sufficiency condition changes as follows:

t m
1

t 0 m0 m0 t 0 t1 t 0 m1 m0 0

(2)

On the other hand, if imports from and tariffs with rest of the world change simultaneously the
sufficiency condition is just the first two terms both for members and for the rest of the world
Note that these are sufficiency conditions. If the value of the above equation is negative,
there is a possibility that the net surplus will be negative as well, but this is not guaranteed. The
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first and last terms in the above equation represent the change in tariff revenues earned by the
government from member countries and the rest of the world. The second term indicates the prereform value of the net decline in the domestic price of imported goods owing to the

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implementation of the agreement. Because this term is always positive, the equation shows that
in the presence of constant returns to scale, there is a net transfer from the consumers to the

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government owing to trade liberalization. Now, if government revenues decline more than this

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transfer (due to the agreement), the probability that the value of the net surplus is negative

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increases.

These sufficiency conditions can be tested empirically with minimal ex post data

requirements. Therefore, we checked whether the sufficiency conditions are satisfied for the
IndiaASEAN FTA in the first four years of its implementation.

As mentioned, the crucial question is whether imports from rest of the world are fixed.

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Figure 1 clearly shows that trade with rest of the world both for ASEAN and India has changed

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substantially. Hence, instead of working with (1), it is more sensible to work with (2). (2) can be
written as follows (we assume that Countries A and B already have an FTA with each other.
Country C is about to liberalize tariff with this group, and W represents the rest of the world):

i j
i , j A , B ,C

(tij1 mij1 tij0 mij0 )

i j
i , j A , B ,C

Trade Within Members

(tij0 tij1 )mij0

t m

i j
i W
j A , B ,C

0
ij

1
ij

mij0

0 (2a)

Trade between ROW and Member Countries

Table 5 summarizes the values obtained using this equation along with its three
constituent parts. For convenience of interpretation, we have shown the last two columns of the
table in Figure 2. It is clear that the net surplus declines over time, especially for ASEAN.

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The reason is a complex interplay of three components: (a) the condition is negative from
2013 because (i) tariff revenue is falling (which is expected) and (ii) trade with the rest of the
world is falling; (b) the condition continues to deteriorate for ASEAN and has improved slightly

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for India in 2014 (though still negative) because (i) the extent of fall in Indias imports from rest
of the world is smaller than that of ASEAN members (ii) India has not reduced tariffs to the

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extent that ASEAN did between 2013 and 2014 and, as a result, Indias tariff revenue suffered to

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a lesser extent.

In both cases, therefore, trade with rest of the world played a crucial role. World trade has

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been subdued for a long time owing to global slowdown due to a global recession. This
continued in 2013 and 2014,6 leading to declines in trade with rest of the world for both India

and ASEAN.

6. How Should the Authorities in India React?

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With the government surplus falling over time and becoming negative from 2013 the
agreement, it appears, has started to become a burden on the Indian economy rather than being

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beneficial to it. In this section we consider three alternative scenarios under which results could
have been otherwise. First we test the hypothesis that the global depression that set in
immediately prior to the agreement was responsible for the declining trend of the surplus at least
for India. One of the primary causes for the decline in the surplus was the decline in Indias trade
with rest of the world since 2008. The alternative scenario presented therefore is: had the rising
trend of import from rest of the world between 2005 and 2008 been interpolated through 2015,
would there have been a better outcome? Figure 3 presents the value of the surplus given this

https://www.wto.org/english/news_e/pres13_e/pr688_e.htm

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alternative scenario. It is clear that the surplus would have been positive throughout under the
circumstances, though it would still be declining up to 2013. Thus the global depression had
played a crucial role for the results in the previous section.

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Another important cause for the result in the previous section was the fall in tariff revenue
from the member countries of the ASEAN. It is clear from section 4 that the correlation between

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change in import and change in tariff is fairly low. To understand what is going on we have

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estimated the following frictionless gravity model7 to estimate the commodity wise (all 6 digit
HS tariff lines) tariff elasticity of imports from 1989 to 2009:
ijt

1 Ln(GDPit * GDPjt ) 2 LnTarijt uijt

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LnImp

(3)

Where Impijt is the import of country i (in our case India) from country j (the six ASEAN
members considered here) in time period t. GDPit and GDPjt are the income levels for country

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India (indexed by i) and country j (six ASEAN members) for time period t respectively, Tarijt is
the tariff imposed by India for imports from country j in time t and uijt is the error term.

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The question that is posed then is the following: How would the surplus react had tariffs been
relaxed (in line with the actual schedule) for only those commodities whose tariff elasticity is
greater than one. In this situation equation (2a) can be written as:

i j
i , j A , B ,C

(tij1 mij1 tij0 mij0 )

i j
i , j A , B ,C

Trade Within Members

(tij0 tij1 )mij0

i j
i W
j A , B ,C

(tij1 mij1 tij0 mij0 )

t m
0
ij

1
ij

mij0 0

i j
i W
j A , B ,C

Trade between ROW and Member Countries

(2b)

Since the ASEAN countries are very close to each other, the distance term is co-linear with the constant hence we
have ignored it.

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Figure 4 shows the result of this simulation. The surplus once again becomes positive with
the familiar falling part up to 2013.
Finally taking a cue from, for instance, Waschik (2009), Lima and Saborowski (2010), Kitwi,

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Nelson and Reed (2009) and Perali, Pieroni and Standardi (2012), we simulate the value of the
surplus under the alternative scenario of simultaneous tariff liberalization with the rest of the

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world.

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The dilemma here is to determine the tariff liberalization structure for the rest of the world.
We tried out several options including phased tariff reduction of a constant percentage, instant

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tariff liberalization in 2010 and application of the same tariff schedule that India offered to the
ASEAN8. Since the results are similar in figure 5 we report only the last case. Once again, it is

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7. Concluding Comments

observed that the surplus remains always positive.

Ex post results of the IndiaASEAN FTA reveal that as far as trade and tariff concessions are

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concerned, ASEAN has benefitted more than India. However, the welfare effect has been
symmetric: both India and ASEAN gained in welfare during the first two years since the
implementation of the FTA, but the gain has been falling over time. This decline has more to do
with external factors than internal. Global slowdown has caused a steep decline in the imports of
both the parties from the rest of the world, resulting in a sharp decline in tariff revenue from the
rest of the world. This has reduced the money available to the governments after taxing gainers
and subsidizing losers. Because India has agreed to reduce tariffs to a greater extent than the
ASEAN countries through this agreement, India appears to be the keener party. The ex post
8

Since India offered different schedules to ASEAN 9 and to Philippines, we have taken the average of these
schedules for this exercise.

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results of the agreement studied here, however, cannot rationalize this keenness. The policy
simulations reveal that the global depression played a decisive role in determining the sign of the
surplus. Thus clearly choosing to sign a FTA during a recessionary period can result in a loss.

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The Indian government could have avoided the negative surplus either by liberalizing more for
the tariff elastic goods relative to the elastic goods or if it had simultaneously signed a similar

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agreement with the rest of the world. India has signed or is currently planning to sign FTAs with

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a wide range of countries: Bangladesh, Sri Lanka, Thailand, South Africa, Chile, Argentina,
Brazil, Paraguay, Uruguay, EU etc. Once these are signed the possibility is high that some of the

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ill effects of this agreement will be wiped out.

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References:

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Ahmed, S. (2012) Sectoral and Gender Implications for India-ASEAN FTA: A CGE Analysis
for India. Centre for Development Studies. Accessed on 27 July 2014. http://www.cds.edu/wpcontent/uploads/2012/09/Sahid-Ahmed-Paper.pdf.

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Bhattacharyya, R. & Mandal, A. (2010) Estimating the Impact of the Indo-ASEAN Free Trade
Agreement on Indias Balance of Trade. Journal of Global Analysis 1: 9-25.

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Bhattacharyya, R. & Mandal, A. (2014) Estimating the Impact of the India-ASEAN Free Trade
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Lim, J.J. & Saborowski, C. (2010) Estimates of Trade-Related Adjustment Costs in Syria,
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Nag, B. & Sikdar, C. (2011) Welfare Implication of India-ASEAN FTA: An Analysis using
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Pal, P. & Dasgupta M. (2008) Does a Free Trade Agreement with ASEAN Make Sense?,
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------ (2009) The ASEAN India Free Trade Agreement: An Assessment. Economic and Political
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Perali, F., Pieroni, L. & Standardi, G. (2012) World Tariff Liberalization in Agriculture: An
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Waschik, R. (2009) The Effects of Free Trade Areas on Non Members: Modelling Kemp-Vanek
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Figures

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Figure 1: Imports from Rest of the World (Million US$)

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Figure 2: Government Surplus (Million US$)

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Figure 3: Government Surplus for Indias Rising Trends in Imports from ROW (Million
US$)

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Figure 4: Government Surplus for Tariff Liberalization of Tariff Elastic Commodities


(Million US$)

Figure 5: Government Surplus for Tariff Liberalization with ROW (Million US$)

19
Page 19 of 22

Tables
Table 1: Simple and Weighted Averages of Tariff Reduction in IndiaASEAN FTA

Simple Average

Weighted Average

2007-10

2010-12

2012-16

2007-10

2010-12

2012-16

India's Offer to ASEAN

15.25

28.76

65.37

8.07

15.17

43.63

ASEAN's Offer to India

10.01

16.86

50.86

4.50

7.19

22.27

7.27

12.06

38.77

0.00

10.64

31.71

28.48

10.83

37.46

Indonesia to India

14.15

28.04

62.85

0.00

25.85

55.16

Laos to India

15.01

6.77

44.81

2.90

5.30

27.46

Malaysia to India

17.25

35.68

90.4

11.02

22.34

59.32

Myanmar to India

0.00

6.79

22.01

7.73

13.65

46.12

Philippines to India

6.51

6.27

38.59

5.95

7.97

21.62

Thailand to India

18.02

34.07

91.72

11.08

22.22

59.64

8.75
Vietnam to India
Source: Authors Own Calculations

11.45

36.86

11.75

20.43

54.31

cr

6.3

3.35

us

10.43

an

Brunei to India
Cambodia to India

ip
t

Year

2007
2012
Ratio of Tariff between FG and IG
Beverages and Tobacco
0.7
0.7
Dairy Products
0.7
0.6
Fruits, Vegetables, Plants
0.9
0.9
Oilseeds, Fats, and Oils
1
0.7
Textiles
1
1
Wood, Paper, etc
0.9
1
Ratio of Tariff between FG and RM
Cereals and Preparations
2
1.2
Leather, Footwear, Etc
0.5
0.3
Oilseeds, Fats, and Oils
1.2
0.9
Ratio of Tariff between IG and RM
Leather, Footwear, Etc
0.4
0.3

Ac
ce
p

Industry

te

Table 2: Inverted Duty Structure in Indian IndustriesIndias Offer to ASEAN 9 (Ratio of


Tariffs)
2016

0.6
0.5
0.8
0.7
0.7
2.4
0.8
0.2
0.8
0.1

Source: Authors Own Calculations


Note: RM Raw Materials, IG Intermediate Goods, FG Final Goods.

20
Page 20 of 22

Table 3: Track-Wise Percentage Reduction in Tariffs from 2007 to 2014


ST
34.82
30.49
32.84
47.25
26.09
50.46
22.27
27.24
13.52
29.10

SP
20.45
NA
NA
NA
NA
NA
NA
NA
NA
NA

HSL
NA
NA
11.49
16.40
9.62
10.33
0.00
NA
NA
4.28

EL
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00

ip
t

NT-2
52.00
65.15
57.14
63.97
32.65
68.33
28.14
30.51
22.88
29.29

cr

NT-1
75.65
100.00
93.36
99.48
36.39
99.39
29.64
44.13
22.74
41.96

us

Countries
India to ASEAN
Brunei
Indonesia
Malaysia
Philippines
Thailand
Cambodia
Laos
Myanmar
Vietnam

Source: IndiaASEAN FTA Tariff Schedule


Note: NA No Tariff Lines in this track

2014
-900.17
137.64
-10740
3.98
-6286.3
-524.22
1036.22
2607.2
-2242.4
3744.83

te

2010
-185.89
53.41
-5138.3
-11.94
-2440.6
-849.57
407.16
1803.09
-1801.2
1482.08

Ac
ce
p

Country
Brunei
Cambodia
Indonesia
Laos
Malaysia
Myanmar
Philippines
Singapore
Thailand
Vietnam

an

Table 4: Indias Trade Balance with ASEAN 6 (Million US$)


Extent of Deterioration
714.28
-84.23
5601.88
15.92
3845.68
-325.35
-629.06
-804.11
441.18
-2262.75

Source: World Integrated Trade Solution (WITS) Database

21
Page 21 of 22

Table 5: Government Surplus and its Components (Million US$)

ASEAN
345.84
298.05
41.62
-772.73
-361.40

India
196.50
275.55
430.22
620.47
369.72

i j
i W
j A , B ,C

ASEAN
56.22
76.54
76.01
175.48
70.12

India
10004.21
6582.20
1911.92
-2243.40
-904.25

1
ij

mij0

ASEAN
10997.35
6312.36
3028.64
-4118.29
-18348.15

Total

India
12703.59
8411.78
3008.03
-2983.31
-1081.82

ASEAN
11399.41
6686.96
3146.27
-4869.24
-18639.43

an

us

Source: World Integrated Trade Solution (WITS) Database

0
ij

ip
t

India
2502.87
1554.03
665.89
-1129.43
-547.29

i j
i , j A , B ,C

t m

(t ij0 t 1ij )mij0

te

2010
2011
2012
2013
2014

i j
i , j A, B ,C

Ac
ce
p

Year

(t 1ij m1ij t ij0 mij0 )

cr

22
Page 22 of 22

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