Pacific B usiness R eview (International)

A Refereed Monthly International Journal of Management Indexed With Web of Science(ESCI)
ISSN: 0974-438X(P)
Impact factor (SJIF):8.603
RNI No.:RAJENG/2016/70346
Postal Reg. No.: RJ/UD/29-136/2017-2019
Editorial Board

Prof. B. P. Sharma
(Principal Editor in Chief)

Prof. Dipin Mathur
(Consultative Editor)

Dr. Khushbu Agarwal
(Editor in Chief)

A Refereed Monthly International Journal of Management

Revealed Comparative Advantage and Competitiveness: An Analysis of India's Trade Potential with Central Asia

Neelam Aarif

Research Scholar

Department of International Business, GITAM School of Business, GITAM Deemed to be University, Visakhapatnam,

Andhra Pradesh, India naarif@gitam.in,

https://orcid.org/0009-0005-1000-662X

 

Dr. Radha Raghuramapatruni

Associate Professor

Department of International Business, GITAM School of Business, GITAM Deemed to be University, Visakhapatnam, Andhra Pradesh,

India rraghura@gitam.edu,

https://orcid.org/0000-0002-4486-5458

 

 

Abstract

Historically India shares a strong bonding with the Central Asian Republics (CARs), connected through the “Silk Route― . The Collapse of USSR, the countries of Central Asia became independent nations. The Central Asian region includes developing economies and is rich in variety of oil, gas and mineral resources. India has been exploring ways to accelerate and integrate its trade, economic and investment relations with these landlocked countries that also have huge geopolitical and strategic importance. Overall, India’s trade with the Central Asia still needs to be tapped to its fullest potential, but there are several initiatives that India has taken to enhance its economic engagement with the region. The current paper attempt to explore and identify the economic and trade relations between the Central Asian economies and India by adopting a series of methods involving intensity indices, various measures of comparative and stability indices. The results reveal an untapped potential between both the regions and complementarity of commodity trade that could be explored for further integration of trade between India and the Central Asian Region.

Introduction

India shares a thick historical bond with the Central Asian economies of Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan and Uzbekistan. The history of the ancient literature provides that, both were the powerful centres and share a great deal of economic and trade share along with strong cultural relations through the connecting “Silk Route”, (Malik & Mir, 2014; Kusuma, 2022; Min, 2024). However, the international relations were controlled by Moscow during the earlier Soviet era, after the year 1991 each independent nation started to have direct economic and international relations with the other countries of the World.

With the fast changing geo-political and geo-economical strategies, tariff wars, changing geopolitics in Afghanistan, India views its central

 

 

 

Asian strategy as crucial one. Central Asia is a resource-rich region that offers opportunities for Indian businesses in sectors such as energy, mining, and infrastructure. India has been exploring ways to boost its trade and investment with Central Asia, including “International North- South Transport Corridor (INSTC)” that helps to link, India with Russia and Europe via Central Asia and Iran. India has also signed bilateral agreements with several Central Asian countries to promote trade and investment. Additionally, India has been involved in several infrastructure projects in the region, including the construction of a 200-km railway line in Afghanistan that will connect with the Iranian port of Chabahar, providing India with an alternate route to access Central Asia and Europe. India has also been exploring opportunities to increase its energy cooperation with Central Asia, which could help the country to serve its energy needs of its growing economy (Kurbanov & Khoshimov, 2022).

Given this background the paper would analyse India’s trade with the Central Asian region along with identification of commodity trade potential between India and the CAR and explore the trade relations between both the region. Following the results few policy implications will therefore be highlighted to enhance trade between India and the Central Asia.

Survey of Literature

During the post-Soviet era, Central Asia has emerged as a hotspot of geo-economics, geo-political and geo strategic importance. The region has vast reserves of natural mineral resources like hydrocarbon and deposits of uranium along with vast potential for hydro power. And the region emerged as pivot for intra and international economic and trade linkages (Kothari, 2020). With the unfolding of the ‘Asian Century’, the countries of Central Asian are attempting to integrate with the countries towards the east through variety of international co-operation agreements like‘Shanghai Cooperation Organization’, ‘Asian Infrastructure Investment Bank’ and the ‘Eurasian Economic Union’ (Contessi, 2016). The geographic location of CAR countries play a significant role in connecting Asia with Europe. Along with this strategic role

 

these countries face a major disadvantage too, because of their geography as these countries are landlocked, thereby transportation has been the major hurdle in trade and movement (Kamalbek & Burulcha, 2020; Na and Na, 2024). Geographically, Central Asia is the central to the Eurasian region is considered as one of the world’s earliest inhabited regions of the world and home of the ancient and highly developed civilization. India has given a special space to the central Asia in its foreign policies and has a historical connect between Central and Indian sub- continent since dates back to the Indus Valley Civilization to the current geopolitical world. India and Central Asian Region (CAR) have economic complementarity in terms of resources, manpower and market (Arif & Gupta 2013). The current period has seen the growth of south-south trade partnerships and the trade volume between India and CAR countries would have been nearly 9 to 10 times larger than the current volumes, the trade route which is continuously prone to geo-political tensions and political disturbances is the major barrier to integration with the CAR countries (Seema & Agarwal, 2017). In the post pandemic geo- political situation security has remained a crucial focal point of India-Central Asian relations. Furthermore, India joined as the member of Shanghai co-operation organization in the year 2017, which includes Kazakhstan, Kyrgyzstan, Tajikistan and Uzbekistan led by China that provides a forum to establish security relationship within the region. “Central Asia Regional Economic Cooperation” digital strategy of 2030 is to expand the digital technology and scale up the digital literacy across the CAR, this provides an opportunity for India’s technology sector and Tech. Start-ups to provide expertise to the Central Asian countries. Similarly, improved supply chain connectivity between India and the Central Asia can improve Medical Tourism for the Central Asian Region (Schulz, 2022). India’s trade with Central Asia region accounts for over $ 2 billion, the India has supported CAR a support of extending a credit line of $1 billion to the regional countries of Central Asia in transport, energy, Information Technology(IT), medicine, education and agriculture along with supporting the grants in social projects. The India EXIM bank also provided with a credit line of $448 million to the

 

 

 

government of Uzbekistan (Kurbanov & Khoshimov, 2022). The changing dynamics in Afghanistan had pushed India to play a pro-active role in the Eurasian region and re- work on its Central Asian strategy, which can be seen in through the ‘Extended Neighbourhood’ and the ‘Connect Central Asian’ strategies.

Database & Methodology

The paper employs a combination of empirical methodology of Intensity Indices, gravity coefficient and various methods of competitive indices to select the commodities that have trade potential between India with CAR. Similarly, the stability of these indices is identified along with the distribution of beta values. The required data for analysis is gathered from various secondary sources of the WTO, IMF and UNCTAD sources. Various statistical tools (SPSS 16.0, advanced excel), Greta and advanced excel were applied for the purpose of analysis.

 

Measuring the Indices & Gravity Coefficient

The export and import intensity indices are the two indices used to observe the trends of trade between India and Central Asia. The Indices were calculated for the period 1995 to 2021. Similarly, the Gravity Coefficient (GC) measure is assessed for India’s trade with the CAR region. Similarly various methods of Balassa’s index were adopted to identify the commodity trade potential.

Trends of Trade between India and Central Asia

India had been integrating with the East Asian region through the initiatives of “Look East Policy” and further through the “Act East Policy”, however the integration of India and the CAR (Central Asian Region) have not been able to tap the potential of the each other’s diverse resources base that existed. The values of TII and III present the same scenario.

 

Chart.1Export Intensity Index (EII) and Import Intensity Index (III) of India's Trade with Central Asian Countries

 

 

 

In order to explore the trade pattern between India and the CAR countries the intensity of trade relations (Export Intensity Index, the EII) and (Import Intensity Index, the III) were identified for the five Central Asian countries, representing in the Chart.1. Among the five countries of the Central Asian Region, India’s trade relations had been greatest with Kazakhstan. The Export Intensity Index (EII) value of India with Kazakhstan were at 0.380 (1995) and this increased to 1.451 (1998) till 2000 (1.167) and their after the EII saw a gradual a decline, but again regained since the year 2009 and reached 0.285 (2021). A gradual rise in India’s exports since 2014 as a result of trade agreements. The Import Intensity Index (III), has seen a consistent rise since the year 2012 (0.156) till the year 2021 (1.527). For most of the years the values have been great than 1, presenting a greater integration of trade between India and Kazakhstan. Kyrgyzstan is comparatively a less developed economy among the CAR Countries, its GDP growth rate is 1.8% during the period 1991 to 2020. During the initial period of the year 1995 it is 0.013, it gradually rose to 4.838 during the year 2000. The volume of trade between India and Kyrgyzstan has been increasing over the years. Both the countries have signed several bilateral agreements to facilitate trade and economic co-operation. For the years 2006, 2007 it has been a positive value of EII 1.967 and 1.095, there after there was a gradual decline of EII to 0.321 (2021). The TII of Kyrgyzstan is 0.058 (1995), for the years 2001 to 2005 the III values were greater than 1 and later there was a decline, for the year 2021 (0.003). Observing the extent of trade potential both the countries continue to engage to enhance business to business interactions and explore new opportunities in various sectors such as IT, agriculture, Pharma and tourism. Tajikistan is a relatively poor country in the Central Asian Region. Though there has been a gradual rise in the GDP growth rates, the per capita GDP has been the smallest among the CAR. The EII and the III values has been the lowest, when compared to the other countries. The values of EII, have been greater compared with the values of III. The EII during the year 1995 is (1.014) during the year 2003, it is 0.777 and again in the year 2015(1.079), by the year 2021 it stood at 0.601. The III has been 0.395 (1995),

 

for the year 2002 (1.225) and this gradually registered at 0.0075 (2021), the bilateral trade volumes between India and Tajikistan has been gradually rising and ranging between $100 m to $200 m annually. Owing to the greater complementarity between the two countries, there is a further potential for growth. The relations between India and Turkmenistan has been modest and had been fluctuating during the period of the study. The volume of trade between the economies has been relatively low when compared to other CAR countries, however but some potential for growth has been found. The EII for the year 1995 has been found at 0.145 during the initial period of study and increased to 1.031 by the year 2001 and reached 1.570 (2021). The III is at 0.364 (1995), 2003 (0.701) and

2021 it is at 0.564. Uzbekistan had been the most populous

country in the Central Asian Region, the volume of trade between India and the Uzbekistan has been growing gradually, the current India and Uzbekistan trade volume reaching the value at 690.5 US$ and the Joint Economic Commission in place between India and Uzbekistan also contributed positively to enhance trace between India & Uzbekistan, the EII during the year 1995 is 0.458 and for the years 2002 to 2005 it has been greater than 1 and gradually declined after for the year 2001 (0.617). The III was registered at 0.622 during the year 1995, for the year 2014 it was at 0.0090 and by the year 2021 is has been registered at

0.057. Both the nations established a Joint Economic Commission to enhance the bilateral trade relations between the two regions. The overall EII and III presents a gradually improving intensity of export and import trade relations between India and the CAR region and further could be enhanced through accelerating the trade volumes between the both the regions. Accelerating the commodity trade potential could help in increasing trade volumes which is analysed in the following sections.

 

 

Table. 1 : Gravity Coefficient of India's Trade with Central Asia

 

Gravity Coefficient of India's Trade with Central Asia

Year

Kazakhsta n

Kyrgyzstan

Tajikistan

Turkmenista n

Uzbekistan

1995

0.2445

0.0440

0.7608

0.233754

0.517

1996

0.1893

0.2539

0.1907

0.091388

0.224

1997

0.7520

1.3549

-

0.150665

0.400

1998

0.9039

1.1459

0.2668

0.236919

0.361

1999

0.8293

2.6870

0.5882

0.39519

0.553

2000

0.7143

2.9683

0.5289

0.228661

0.544

2001

0.6142

1.8183

-

0.164092

0.671

2002

0.4096

2.1113

-

0.273717

0.775

2003

0.3724

2.9392

0.7439

0.527425

1.035

2004

0.3684

3.8822

0.6697

0.491429

0.819

2005

0.2600

2.2155

0.4271

0.468486

0.895

2006

0.2593

1.4566

0.2760

0.412664

0.584

2007

0.1794

0.7672

0.2912

0.348855

0.375

2008

0.2212

0.3243

0.3678

0.25148

0.456

2009

0.2802

0.4225

0.6285

0.285201

0.287

2010

0.2164

0.3430

0.5543

0.233468

0.264

2011

0.1644

0.3868

0.2895

0.159403

0.337

2012

0.2136

0.2879

0.4072

0.189439

0.373

2013

0.3136

0.2813

0.3337

0.172471

0.361

2014

0.6409

0.2840

0.5615

0.250962

0.466

2015

0.3778

0.3535

0.9624

0.473562

0.452

2016

0.5055

0.3148

0.6064

0.406189

0.404

2017

0.8045

0.4578

0.6622

0.371181

0.523

2018

0.6715

0.2747

0.4642

0.382477

0.550

2019

1.1604

0.2698

0.2711

0.179807

0.408

2020

1.4887

0.4698

0.3497

0.295465

0.546

2021

0.7299

0.2683

0.4484

0.496914

0.422

 

Source: Calculated from the unctad.org

The Gravity coefficient has been one of the determinants that reflects the gravity of trade between the countries. The gravity coefficient helps to explore the gravity of trade that exists between the two regions India and the Central Asian countries (Table.1). The values of Gravity Coefficient (GC) presents that India and the CAR have not been able to take the full advantage of its trade complementarity. One of the factor of hindrance has been the lack of common boundary with the Central Asian countries. The trade gravity values between India and the five Central Asian Countries present the under-utilized trade potential

 

between the countries. The volume of trade between the two could be further enhanced by accelerating the trade ties between the nations. The GC values between India and Kazakhstan presents decent trade gravity which could be further enhanced. Initially the value of GC were at 0.244 (1995) and this further increased to 1.16 (2019), 1.488 (2020). India’s Oil and gas companies under the government sector has been heavily investing in Kazakhstan. When compared the GC values between India and Kazakhstan the values have been higher than the other 4 countries of Central Asia. The economy of Kyrgyzstan is

 

 

 

largely supported by its sectors like agriculture, mining and terrorism. Initially the GC values have been at 0.441 (1995), it reached a maximum of 3.88 during the year 2004 and thereafter there was a gradual decline to 0.268 (2021). India and Tajikistan share cordial trade relations with a gradual rise in the total volume of trade between the two countries. During the year 2022 India’s exports to Tajikistan $74 USM and imports is at $43USM. The total volume of gravity co-efficient has been at 0.76 during the year 1995 and this stood at 0.44 during the year 2021. India and Turkmenistan gravity coefficient values have been a gradual rise from 0.233 (1995) to 0.412 (2006) and thereafter a decline and again regained in (0.448) 2021. With the complete potential yet to be gained both the nations signed 8 MOU’s in the year 2018 in the areas of Peace, disaster management, renewable energy, education and agricultural research. The total bilateral trade between India and Turkmenistan was at US$M 192.01. The values of GC also seen a gradual rise with 0.237 (1995) to 0.496 (2021). During the year 2003 it was at 0.491. India and Uzbekistan have a modest bilateral turnover of over 300m US$ by 2020. Pharmaceuticals is a major area of trade and investment. Medical tourism to India has increased sharply resulting in the rise in the values of GC values to 0.517 (1995) and to 0.422 (2021). The values of GC presents under- utilized complementarity between CAR and the India.

Analysis of Results - Revealed Comparative Advantage

India has historical, cultural civilizational links between

 

India and the Central Asian region. India requires energy resources is a perfect complement to the energy rich CAR region. Transportation has been a major hurdle trade with the landlocked CAR region. There were several initiatives “International North-south Transport Corridor, connecting India to Russia & Europe through the Central Asia & Iran, and the Turkmenistan- Afghanistan-Pakistan –India. TAPI Pipeline were some of the initiatives to support the transportation and supply chain network. The commodity trade potential between India and the Central Asian Region is identified through 39 commodities under 7 distinct categories (Table.II). The Annual Revealed comparative Advantage (RCA) indices were identified for four categories B (Balassa’s Index), RTA (Revealed Trade Advantage Index), In RXA (log RXA) and the RC (Revealed Competiveness), to identify the commodity trade potential between India and the CAR. The mean value of Blass Index (B, RTA, In.RXA, RC) for the period 2016 -2021 were analysed and presented in the above Table. The indices reveal a similar trading pattern with all the four indices [(Balassa’s Index- ‘B’), (Relative Trade Advantage-’RTA’), (Relative Export Advantage- ‘RTA’), (Relative Import Advantage Index-‘RMA’) were presented for analysis. The Balassa’s index could be seen in 27 commodities, the relative trade advantage is identifies with respect to 31 distinct commodity groups, where the RTA>0, similarly the relative export advantage (In RXA>0) is seen in 26 commodity trade patterns.

 

Table. II: Revealed Comparative Advantages of India with respect to Central Asian Countries by Product Group and Index, 2016-2022

 

 

 

 

Product Group

 

Mean

Coefficient of Variation (Percent)

 

B

 

RTA

InR X A

 

RC

 

 

B

 

 

RTA

 

In RXA

 

 

RC

>1

>0

>0

>0

Food & Live Animals:

Live Animals other than animals of division 03

0.254

0.241

-0.596

1.035

120.076

123.365

-102.328

41.993

Meat and meat preparations (01)

4.215

4.215

0.625

4.745

51.560

9.510

6.542

3.531

Dairy products and birds' eggs (02)

0.680

0.663

-0.168

1.595

25.823

26.600

-68.124

8.870

Fish, crustaceans, molluscs and preparations thereof (03)

22.43

6

22.30

3

1.351

2.224

22.562

22.830

7.772

9.065

Cereals and cereal preparations (04)

1.089

1.019

0.037

1.367

11.711

15.952

142.428

32.470

 

Vegetable and Fruits (05)

 

0.662

 

-0.195

 

-0.179

 

-0.101

 

11.714

-130.588

-27.177

-140.543

 

 

Sugar, sugar preparations and honey (06)

9.012

8.948

0.955

2.112

45.789

45.978

25.326

7.909

Coffee, tea,cocoa,spices and manufactures thereof (07)

10.318

10.071

1.014

1.631

9.484

10.193

4.108

8.947

Feedstuff for animals (excluding unmilled

cereals) (08)

3.650

3.200

0.562

0.904

33.023

40.063

29.294

29.007

Miscellaneous edible products and preparations (09)

2.025

3.595

0.306

1.571

16.195

33.511

23.128

0.967

Food, basic excluding tea, coffee, cocoa and spices (SITC 0 + 22 + 4 less 07)

 

1.684

 

1.114

 

0.226

 

0.480

 

8.997

 

19.800

 

16.446

 

11.681

Beverages and Tobacco:

Beverages (11)

0.738

0.539

-0.132

0.575

11.961

16.867

-41.942

15.493

Tobacco and Tobacco Manufactures (12)

1.759

1.729

0.245

1.785

15.438

15.614

29.285

8.046

Mineral Fuels , Lubricants and Related Materials

Crude Rubber (Including Synthetic

and reclaimed) (23)

1.129

-9.490

-9.490

-0.936

59.116

-23.756

492.767

-31.214

Coal, coke and briquettes (32)

0.094

-8.237

-8.237

-2.066

105.386

-17.701

-30.390

-12.401

Petroleum, petroleum products and related materials (33)

0.307

-2.477

-5.030

-1.225

12.728

-32.901

-10.361

-8.585

Gas, natural and manufactured (34)

0.005

-2.477

-2.284

-2.666

11.184

-30.371

-2.269

-4.785

Electric current (35)

0.350

0.328

-0.455

0.128

86.975

99.797

-113.359

741.624

Chemicals and Related Products, n.e.s

Organic Chemicals (51)

55.683

48.192

1.746

0.827

53.550

156.999

13.097

57.528

Inorganic Chemicals (52)

0.143

-1.604

-0.843

-1.083

29.310

-38.333

-18.051

-15.276

Dyeing , tanning and colouring materials (33)

32.867

32.1788

1.517

1.686

12.953

13.097

3.713

6.110

Medicinal and pharmaceutical products (54)

47.428

47.138

1.676

2.223

11.342

11.484

2.897

6.215

Essential oils for perfume materials and cleaning

preparations (55)

13.990

13.779

1.146

1.825

17.053

17.149

7.025

4.681

Fertilizers other than group 272

0.071

-3.860

-1.152

-1.755

30.479

-28.374

-13.687

-14.026

Manufactured Goods

Leather, leather manufactures and dressed furskins (61)

2.587

-7.759

0.413

-0.594

27.215

-49.429

25.721

-38.253

Rubber manufactures, n.e.s. (62)

39.126

36.360

1.592

2.217

37.837

40.694

12.497

8.612

Cork and wood manufactures (excluding furniture) (63)

10.662

10.523

1.028

1.875

21.281

21.483

9.264

4.402

Textile yarn and related products (65)

3.534

3.006

0.548

0.826

18.615

23.242

15.176

16.141

Paper and Paper Manufactures

38.040

37.638

1.580

1.970

21.305

21.451

5.943

3.276

Iron and steel (SITC 67)

0.842

0.530

-0.075

0.423

22.936

33.498

-133.640

21.983

                   

 

 

Machinery and Transport Equipment

Specialised machinery (72)

10.452

10.117

1.019

1.489

24.661

25.535

10.577

9.698

Telecommunication and sound recording apparatus (76)

12.179

11.014

1.086

0.975

52.436

60.098

24.515

36.238

Electrical machinery, apparatus and appliances,

n.e.s. (77)

7.267

6.093

0.861

0.801

12.841

14.186

6.514

12.705

Road vehicles (78)

14.578

14.379

1.164

1.825

53.075

53.922

18.497

14.380

Other transport equipment (79)

4.484

3.770

0.652

0.750

53.150

63.519

37.023

35.988

 

Miscellaneous Manufactures Articles

Furniture and parts thereof (82)

28.224

27.859

1.451

1.875

30.636

30.921

8.856

5.420

Travel goods, handbags, etc. (83)

13.638

32.380

1.135

1.668

36.010

36.711

14.669

13.389

Footwear (85)

17.083

16.901

1.233

1.944

36.044

36.307

18.745

10.586

Professional and scientific instruments, n.e.s. (87)

4.539

3.538

0.657

0.657

21.288

28.614

13.524

19.862

 

Source: Analysis done for B, RTA, logRXA and RC,

Further the above reviews presents Indian economy as perfect complement to the Central Asian economies which provide enough room for international trade (Arif & Gupta 2013). Finally the Revealed Competitiveness is seen in 31 products where the RC>0. The final summary statistics of

 

the mean and the CV for the four Indices of the all the products (B, RTA, In.RXA and RC) are presented in the Table II. The values registered under the CV (Co-efficient of Variation) for these categories also present a fairly stable index over a period of 6 years period of time.

 

 

Table.III Stability of the Revealed Comparative Advantage Index

Percentage of the Product Groups where:

Inde x

RCA 2016

an d

RID 2021

and

RID 2021

and

RCA 2016

 

 

 

 

 

 

 

B

71.79

28.21

30.77

 

69.23

RTA

70.26

29.74

26.25

 

73.75

In RXA

 

68.23

 

31.77

 

46.25

 

 

53.75

RC

72.26

27.74

26.74

 

73.26

 

Source: Author's Calculation based on Table, II

 

The details of the Coefficient of Variation examined in the earlier table presently a fairly stable values over the period studies (6 years). Further to validate this the authors adopted a series of measures, a simple measure to understand the stability (Table. III) is to find the RCA of the identified products in time 't', but a disadvantage i.e RCD in the later period (t+1). Similarly, to identify RCD in the initial time period 't' and an RCD in the 't+1' period. The analysis presents that Balassa's Index that 71.79% of the products were having RCA during the period 2016 and this

 

 

shifted to 28.21( RCD) during the period 2021. Similarly, 30.77% of the commodities were having disadvantage during the year 2016 and this shifted to RCA (2021) of 69.23%. The analysis of Revealed competitiveness (RC) reveals that 72.26% of the commodities exhibited Revealed Competitiveness (RC) and 26.74% of the commodities exhibited (RC) during the year 2016 and this shifted to 73.26% by the year 2021. The table presently a clear shift in the revealed comparative advantage in these commodities

 

 

 

for which India exhibited a shift to the revealed independence during the period 2016, but this proportion is

 

26.74%. Similarly, the percentage of the commodities which have RCA shifted to RCD also fairly maintained a similar value.

 

 

Table. IV Distribution of Balassa Index and 'B' Value

 

Summary Statistics

2016

2017

2018

2019

2020

2021

Mean

9.103

11.353

12.448

11.132

10.256

11.057

Maximum

57.678

79.382

101.320

48.075

47.680

51.900

Percentof ‘B’

<1

26

27

28

28

28

28

<2

21

23

26

24

23

26

<3

21

23

25

22

17

22

<4

18

20

22

13

15

18

Source: Calculated from the Table, II

 

 

However examining the distribution of Balassa's value (Table. IV) over the period of study, India's RCA index which was 9.103 (means) during the year 2021 rose to

11.057 during the year 2021. The maximum value also which was 57.67 in the year 2016, experienced a decline to

51.90 in the year 201. The percentage of 'B Value' greater than '1' during the initial period (2016) of assessment it is 26% and this was 28% by the year 2021. The percentage values of 'B' which was (<3) was 21% and this rose to 22% by 2021and 'B' values (<4) were similar during the year 2018 and 2021.

Conclusion & Policy Implications

The overall analysis of India's trade with CAR economies presents immense potential of India's trade with the Region, the trade potential product groups analysed presents immense potential that could be tapped by singing in and co-operating the areas of export potential, focussing on infrastructure and transport feasibility with the land locked countries. Similarly, focusing on the tariff lines and geopolitical scenario also would increase the trade feasibility between the economies.

Involvement of Chine in the Central Asian Region (CAR), and the formation of 'One Belt and One Road' initiative and other factors, can be carefully dealt with the right strategy.

 

The resource rich CAR is a perfect complementary to the manufacturing and technology driven changing India's basket of exports. The Balassa's index was found present in 27 commodities, the Relative Competiveness is identified with respect in 31 distinct commodity groups also supports the contention of accelerating its trade & economic relations between India and the CAR region.

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Appendix. Table. 1 Export Intensity Index of India's Trade with Central Asian Countries

 

Year

Kazakhstan

Kyrgyzstan

Tajikistan

Turkmenistan

Uzbekistan

1995

0.38

0.013

1.014

0.145

0.458

1996

0.169

0.19

0.177

0.172

0.282

1997

0.563

2.433

0.239

0.219

0.672

1998

1.451

1.704

0.118

0.324

0.642

1999

1.193

3.607

0.576

0.612

0.512

2000

1.167

4.838

0.748

0.463

0.499

2001

0.206

0.323

-

0.091

0.933

2002

0.084

0.539

-

0.161

1.291

2003

0.083

0.12

0.777

0.433

1.57

2004

0.081

0.082

0.531

0.417

1.239

2005

0.12

0.634

0.186

0.51

1.263

2006

0.364

1.967

0.136

1.031

0.631

2007

0.267

1.095

0.261

0.979

0.543

 

 

Year

Kazakhstan

Kyrgyzstan

Tajikistan

Turkmenistan

Uzbekistan

2008

0.288

0.452

0.267

0.596

0.396

2009

0.359

0.632

0.495

0.402

0.429

2010

0.318

0.51

0.401

0.342

0.44

2011

0.387

0.419

0.309

0.314

0.508

2012

0.354

0.371

0.351

0.445

0.571

2013

0.34

0.369

0.421

0.379

0.549

2014

0.339

0.37

0.653

0.593

0.712

2015

0.34

0.453

1.079

0.71

0.581

2016

0.303

0.403

0.627

0.695

0.486

2017

0.24

0.408

0.421

0.774

0.644

2018

0.256

0.323

0.465

1.063

0.678

2019

0.301

0.342

0.36

0.73

0.519

2020

0.387

0.631

0.499

0.872

0.835

2021

0.285

0.321

0.601

1.57

0.617

Source: Calculated from the unctad.org

Appendix. Table. 2 : Import Intensity Index of India's Trade with Central Asian Countrie

 

Yea r

Kazakhstan

Kyrgyzstan

Tajikistan

Turkmenistan

Uzbekistan

1995

0.177

0.058

0.395

0.364

0.622

1996

0.249

0.189

0.204

0.032

0.122

1997

1.125

0.048

-

0.045

0.091

1998

0.436

0.096

0.292

0.041

0.077

1999

0.733

0.818

0.474

0.072

0.468

2000

0.650

0.645

0.321

0.066

0.506

2001

1.075

2.926

0.317

0.235

0.322

2002

0.817

2.923

1.225

0.422

0.239

2003

0.708

4.280

0.519

0.701

0.564

2004

0.674

5.268

0.503

0.499

0.465

2005

0.392

2.065

0.374

0.521

0.546

2006

0.214

0.099

0.250

0.362

0.479

2007

0.113

0.018

0.133

0.147

0.200

2008

0.212

0.010

0.157

0.114

0.344

2009

0.223

0.013

0.243

0.059

0.127

2010

0.204

0.011

0.260

0.101

0.115

2011

0.099

0.096

0.061

0.077

0.167

2012

0.156

0.010

0.122

0.036

0.089

2013

0.351

0.005

0.004

0.056

0.096

2014

1.071

0.005

0.025

0.067

0.096

2015

0.413

0.016

0.087

0.298

0.163

2016

0.693

0.024

0.115

0.202

0.173

2017

1.266

0.152

0.351

0.133

0.210

2018

1.062

0.028

0.098

0.556

0.136

2019

1.762

0.022

0.002

0.051

0.098

2020

2.204

0.063

0.003

0.010

0.047

2021

1.527

0.003

0.075

0.564

0.057

Source: Calculated from the unctad.org

Abbreviations : RC- Revealed Competitiveness CAR- Central Asian Region EII- Export Intensity Index III-Import Intensity Index : RCA- Revealed Comparative Advantage RTA-Revealed Trade Advantage RXA- Revealed Export Advantage RID-Revealed Import Dependence