Working Papers

What role should connectivity play in reenergising South Asia?

AWP 188 February 2020 Prabir De and Dujairaj Kumarasy

South Asia could unleash its full potentials, provided, it improves the infrastructure facilities, which are at present not sufficient to meet the growing demand of the region. The renewed and shared agenda of the South Asian regional cooperation should aim to reduce both intra- and inter- regional trade facilitation gaps as well as to expand the connectivity. South Asia has to enact its own connectivity and trade facilitation arrangement to take forward the agenda of South Asian integration.

Next generation non-tariff measures: Emerging data policies and barriers to digital trade

AWP 187 January 2020 Gloria Pasadilla

Trade used to be about goods crossing borders and the instrument of protection was mostly through tariffs. Then there was greater recognition of trade in services, now exceeding the share of goods in global trade. Because of services, the focus of trade protection shifted more towards ‘behind the border barriers’ or domestic regulations that can obstruct services trade. More recently, the flows of goods and services are eclipsed yet again by data flows whose contribution to the economy is projected to reach 11 trillion USD by 2025.

Fostering cross-border twin cities as instruments for sustainable development

AWP 186 July 2019 Hubert Massoni and Masato Abe
Looking closely at borders in South-East Asia reveals the existence of adjacent townships of different nations that develop across the border with varying degrees of parallelism. Such cross-border twin cities act as production, trade, logistics and border nodes, shaping cross-border value chains and concentrating economic activities, industries, resources, labour forces, knowledge and infrastructure in geographical spaces connected by multimodal transport networks. Literature assessing the development of cross-border twin cities generally reveals cross-cutting socioeconomic benefits for the border zones, indicating strong potential for sustainable and inclusive development. This study hence attempts to build a theoretical framework of cross-border twin cities...

Non-tariff measures and sustainable development: The case of the European Union import ban on seafood from Sri Lanka

AWP 185 May 2019 K.P.G. L. Sandaruwan and Senal A. Weerasooriya
Non-tariff measures (NTMs) can affect trade performance of trading partners. In addition to trade performance, the NTMs (including sanctions) may have direct and indirect linkages to capacity of trading partners to meet their commitments under Sustainable Development Goals (SDGs). The purposes of this research were to explore the performance of exports of seafood industry of Sri Lanka before, during and after the imposition of European Union’s ban in January, 2015 and to develop indicators and measure the impact of the same ban on stakeholders of the seafood industry in Sri Lanka by looking through the prism of sustainable development. More specifically, this study applied composite indicator approach with min-max normalization, arithmetic mean aggregations and weighting techniques to assess impact on several of SDGs. The principal component analysis was performed to identify the best sub-indicators for the composite indicator. During the period when the ban was in force, Sri Lanka seafood industry experienced lower revealed competitive advantage score, market concentration score and growth rate than at other times. Further, the findings revealed that the ban generated mixed effects on SDGs. Due to the ban, SDG 12 (responsible production) and SDG 14 (life below water) have been positively impacted while SDG 1 (no poverty) and SDG 8 (economic growth) were adversely affected. The research recommends that unilateral and ad hoc decisions should not be taken regarding NTMs because they have very sensitive and invisible linkages with SDGs. Furthermore, when there are legitimate need to impose such NTMs, sufficient time should be given to the trading partners to put in place measures and actions for compliance with such NTMs.

An assessment of fishing vessel capacity on subsidies, non-tariff measures, and attaining Sustainable Development Goals

AWP 184 May 2019 Radika Kumar and Jadhav Chakradhar
The members of the World Trade Organization (WTO) have been continuously involved in achieving a balanced outcome in the area of fisheries subsidies negotiations in 2018. The discussions have been ongoing and will continue in 2019. According to the 11th Ministerial Conference decision of the WTO, members are committed towards securing a deal in 2019. There are various aspects of fisheries subsidies that members of the WTO are presently assessing. The SDG (Sustainable Development Goals) Target 14.6 is one of the fundamentals for an outcome in the fisheries negotiations. The SDG Target 14.6 aims to prohibit or reduce fisheries subsidies linked to overfishing, overcapacity and illegal, unreported and unregulated fishing (IUU). In 2018, in the Rules Negotiating Group (RNG) on the fisheries clusters, members have discussed on overfishing and IUU issues. However, discussions on the overcapacity issue merits further investigations part of the SDG Target 14.6. This paper therefore aims to assess the relationship between fishing vessel capacity and fisheries subsidies as well as non-tariff measures, and provide further policy advice to trade negotiators in relation to the SDGs. In the assessment, we use panel data modelling of select developed OECD member countries that hold current vessel capacity and assess this against subsidies, non-tariff measures, exports and fish landing. The selected OECD member countries comprise of the proponents of the “Friends of fish” group. The finding of the paper provides policy recommendations for negotiators on fisheries subsidies and overcapacity. It also provides suggestions for special and differential treatment for developing and least developed countries (LDCs) in the fisheries negotiations.

Tariff liberalization in the RCEP trade agreement and impact on India`s automobile industry: An applied general equilibrium analysis

AWP 183 April 2019 Badri Narayanan G., Rahul Sen and Sadhana Srivastava
Adequate attention has not been paid by researchers towards general equilibrium effects of trade liberalization particularly involving trade in global value chains (GVC) goods, in spite of its emergence being an established phenomenon among Regional Comprehensive Economic Partnership (RCEP) members including India. This paper contributes in that aspect by undertaking a Computable General Equilibrium (CGE) simulation utilizing the GTAP 9 database updated to 2015, augmenting it to study the automobile sector of trade in GVC goods in the Indian context. In the case of automobile industry, ours is the first attempt to employ this tool in this context and this is one of the methodological/data contributions of this paper. The key here is to analyze the welfare effects for India, in a probable futuristic scenario of a full tariff liberalization (with and without any productivity improvement) as part of the ongoing RCEP negotiations, and the specific impact of this on output, prices and trade in the automobile and auto-parts industry, wherein GVC led trade assumes significance...

The impact of odd-even transportation policy and other factors on pollution in Delhi: A spatial and RDD analysis

AWP 182 March 2019 Somesh K Mathur, P M Prasad, Praveen Kulshreshtha, Sangeeta Khorana and Manish Chauhan
This paper is motivated by persistent environmental problems in Delhi, India which present a serious threat to the well-being of the people in the city. The authors use a statistical approach to quantify the relationship between new transportation policy adopted by the Delhi Government, other controlled factors like meteorological conditions, price of fossil fuel, ban on crackers, burning of agriculture residue, among others on the concentration of various gaseous pollutants and air pollution levels at certain measurement stations in Delhi. Moreover, they try to explain whether the odd-even transportation policy has been able to reduce pollution in Delhi both in short and long run and its impact on pollution levels existing in Delhi. At the end, they suggest some policy measures which should be undertaken to reduce pollution levels in Delhi.

What does RCEP mean for insiders and outsiders? The Experience of India and Sri Lanka

AWP 181 August 2018 Ganeshan Wignaraja

This paper explores the economic implications of the Regional Comprehensive Economic Partnership (RCEP) – Asia’s largest trade agreement - on India and Sri Lanka. The findings from existing model-based studies suggest that India, as an insider economy, will potentially gain from the RCEP while outsider economy Sri Lanka will likely loose. India faces challenges in the RCEP negotiations in liberalizing goods and services trade and adopting new intellectual property rules. Building business competitiveness and policy reforms can mitigate these challenges.

Trade liberalisation and poverty: Evidence from Thailand

AWP 180 June 2018 Wannaphong Durongkaveroj and Taehyun Ryu

This paper replicates the study of Topalova (2010), performs a robustness check, and extends the findings by applying the estimation technique to the economy of Thailand. Topalova (2010) found that trade liberalization in India has heterogenous effects on poverty and household consumption. More specifically, districts in which production sectors are more exposed to trade openness, experienced less poverty reduction and slower consumption growth. The effects of trade reform on poverty have been extended to a squared poverty gap, and the results are robust to other poverty measures.

Corruption and the business environment in Viet Nam: An exploratory survey

Corruption and the business environment in Viet Nam: An exploratory survey

AWP 179 April 2018 Daisuke Maruichi and Masato Abe
This paper examines the effect of corruption on the business environment in Viet Nam. Our survey of firms operating in Viet Nam suggests that corruption is perceived as the most severe business constraint for their operation. Also, corruption has a significant negative association with the overall satisfaction of the business environment in Viet Nam. Such results support the hypothesis that corruption has a “sand the wheel” effect on firms’ business activities. While this paper sheds light on the importance of corruption, it would be useful to conduct follow-up studies to examine corruption and its impact in more detail. Such studies could be conducted in those segments that most severely suffer from corruption according to our survey, i.e., medium-sized enterprises, hotel/restaurant and construction sectors, Hanoi based, and Vietnamese owned firms.
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