India and Bangladesh: an analysis of bilateral trade between two emerging economies of SAFTA

Hafiz Wasim Akram, Shouvik Sanyal and Habib Sano Aliy

International Journal of Business and Globalisation, 2024, vol. 38, issue 3, 425-440

Abstract: The paper analyses India-Bangladesh bilateral trade with reference to South Asian Free Trade Area. For the purpose of analysis, the data period ranges from 1995 to 2019. The primary analysis reveals that bilateral trade has been weak, lackadaisical and the SAFTA agreement has not brought about any perceptible change in bilateral trade performance of these two countries. The causes of poor trade performance have been checked by applying revealed comparative advantage (RCA) as suggested by Balassa (1965) and trade complementarity index (TCI) as suggested by the International Trade Department of World Bank (ITD-World Bank, 2010). The prospect of intra-industry increment was also examined by using Grubel-Lloyd index introduced by Grubel and Lloyd (1971). The analysis reveals that India and Bangladesh suffer from lack of export specialisation in a majority of product groups and weak trade complementarities exist between them.

Keywords: India-Bangladesh trade; revealed comparative advantage; RCA; trade complementarity; Grubel-Lloyd index; SAARC; SAFTA; India; Bangladesh. (search for similar items in EconPapers)
Date: 2024
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