Report

Contents
Preface
Executive Summary
Objective
Methodology and Key Results
Impact of Trade and Transport Facilitation
SAFTA and Trade in Services
Conclusion
v
xi
xi
xi
xvii
xvii
xix
PART I
Benefits from Trade, Investment and
Transport Facilitation
1. Introduction 3
The Context 3
The Background 5
South Asian Free Trade Area 6
Economic and Trade Profile of SAARC Countries 8
2. Literature Review and Rationale for SAFTA 24
Literature Review 24
Rationale for SAFTA 28
3. Competitiveness and Complementarities 30
Introduction 30
Intra-Regional Trading Profiles of SAFTA Member Countries 30
Extent of Competitiveness in South Asia 31
Intra-Regional Complementarities 33
Intra-Industry Trade in SAFTA Region 34
Conclusion 37
4. Effective Additional Market Access under SAFTA: Countrywise Analysis 38
Introduction 38
Effective Additional Market Access: Results 39
Effective Additional Market Access: Countrywise Analysis 41
5. Etimation of Potential Trade under SAFTA with the Gravity Model 43
Introduction and Review of Literature 43
Methodology 44
The Empirical Results from the Gravity Model 45
Estimates of Potential Trade 46
6. Impact of SAFTA on Member Countries: General Equilibrium Analysis 48
Introduction 48
Impact of SAFTA 48
Conclusion 53