Indo-Pak Trade: Current Status and Future Prospect
Keywords:
Indo-Pak Trade, RCA, MFN, SITCAbstract
Focussing on the analysis of current status and future prospect of Indo-Pak trade, the paper attempts to analyse the trend in India’s trade with Pakistan as a percentage of its total trade with world. An attempt is also made to examine India’s and Pakistan’s relative competitiveness by calculating revealed comparative advantage index as suggested by Balassa (1965). It was found that India’s trade with Pakistan is meagre. The low level of trade between them can be attributed to low level of export potentialities of both the countries in meeting the import requirements of each other. Though India has more diversified export basket, a brief analysis of trade basket of India and Pakistan shows that they are competing with one another in the same industries in the International market. Apart from it, bad political relations due to the issues such Kashmir, intermittent aggressions by Pakistan such as Bombay attack etc are the reasons for the subdued trade between them.
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