Assessing The Barriers To Trade In Services In South Asia

This study aims to assess barriers to service trade in the education, health, telecom, transport and travel and tourism sectors of selected South Asian economies such as India, Sri Lanka, Pakistan, Nepal and Bangladesh, including both trade and domestic restrictions. The analysis is focused on computation of aggregate and modal service trade restrictiveness indexes (STRIs) by sector, drawing on information gathered based on detailed questionnaires. The conclusions highlight that while significant regulatory reforms have taken place in certain (for example Telecom) service sectors over the last decade, a broad range of restrictions still remain. The most significant change in these service sectors has been the lifting or softening of the constraints imposed on foreign equity participation. Interestingly, the economies in terms of regulatory reforms are more open to non-South Asian economies and not so much open to each other. However, reforms have had varying degrees of impact on market structure depending on the country and the sector. Based on findings of the study it is possible to argue that industrialisation is not the only route to economic development. Overall, technological changes (with the help of splintering and disembodiment of services) have made many services tradable as happened in the case of manufactured goods. Therefore, adequate reforms may not only remove the barriers to services trade but also generate higher services trade in the region, through which the region may achieve higher income and employment.

This book observes that an in-depth study exclusively focusing on health service trade not only strengthens the overall services trade capacity of the South Asian region, but also promotes global as well as regional trade. There is a dearth of analytical research on estimating barriers to trade in health services, particularly in the context of South Asia, and as such, this book assesses the potential benefits and economic costs of barriers to trade in health services in select South Asian economies. It also analyzes the impact of liberalization and regulatory reforms on economic welfare. It broadly addresses issues relating to trade in health services, the GATS (General Agreement on Trade in Services), such as: Why are the current levels of trade in health services low? How will the GATS legally affect a country’s health policy? What effect might liberalization have on national health systems? And what are the likely benefits of greater trade in health services? It also provides specific answers to the following questions: Does the substantial role of the government in health – as health service provider, financial supporter, regulator and promoter – have implications for the treatment of the sector under the GATS? What is the impact of liberalization of international trade in health services on the quality and availability of health services in developing SAARC countries? Given the importance of consumption abroad for trade in health services, and the gradual opening of health markets through Modes 1 and 3 (cross-border supply and commercial presence), how can problems associated with trade in these Modes be prevented? And are these problems sufficiently addressed by GATS disciplines? Answers to these questions will be of great use to researchers, policy makers as well as practitioners and NGOs of South Asia.

This book observes that an in-depth study exclusively focusing on health service trade not only strengthens the overall services trade capacity of the South Asian region, but also promotes global as well as regional trade. There is a dearth of analytical research on estimating barriers to trade in health services, particularly in the context of South Asia, and as such, this book assesses the potential benefits and economic costs of barriers to trade in health services in select South Asian economies. It also analyzes the impact of liberalization and regulatory reforms on economic welfare. It broadly addresses issues relating to trade in health services, the GATS (General Agreement on Trade in Services), such as: Why are the current levels of trade in health services low? How will the GATS legally affect a countrys health policy? What effect might liberalization have on national health systems? And what are the likely benefits of greater trade in health services? It also provides specific answers to the following questions: Does the substantial role of the government in health - as health service provider, financial supporter, regulator and promoter - have implications for the treatment of the sector under the GATS? What is the impact of liberalization of international trade in health services on the quality and availability of health services in developing SAARC countries? Given the importance of consumption abroad for trade in health services, and the gradual opening of health markets through Modes 1 and 3 (cross-border supply and commercial presence), how can problems associated with trade in these Modes be prevented? And are these problems sufficiently addressed by GATS disciplines? Answers to these questions will be of great use to researchers, policy makers as well as practitioners and NGOs of South Asia.

This paper attempts to examine the determinants of services export and its barriers to trade. We have looked at the cross-country experiences in developing economies of Asia-Pacific such as ASEAN and SAARC, in general, and India, in particular. Our objective is to understand the macro perspective of performances of services export and also whether the supply side barriers such as the infrastructure facilities that facilitate services trade have an effect on the growth of services export in developing economies of Asia-Pacific. We find that ASEAN region has a high potential to benefit from the services export, given that services trade facilitation index (STFI) and institution index is positively promoting services export and also ASEAN reacts favorably towards world import of services. The study suggests that SAARC has to emphasis on infrastructure development that facilitates the services export. In case of India, we find that STFI is negative and insignificant for total services. However, when services export is disaggregated, STFI is negative but significant for financial, transportation and travel services, which suggest that improved service trade facilitation would help unlock the unrealized trade potential in these sectors. In case of computer and information technology services, our estimated models indicate that STFI has been facilitating services export from India.

In this era of globalization, every region and country in the world is pursuing some kind of integration to further its economic, geo-political, and strategic interests. This book explores the prospects for and challenges to services integration in South Asia through an in-depth analysis of services such as telecommunications, energy, tourism, health, and education. Identifying trends in performance, policy issues, and the status of intra-regional trade and investment initiatives, the book argues the case for services integration under the South Asian Free Trade Area (SAFTA). It also stresses the need to address cross-cutting issues of regional mobility of service providers, taxes, transport, trade, research and development, and regulatory cooperation. Expanding the existing work on South Asian integration to cover services from an intra-regional perspective, this book is an important reference for future academic and policy work in South Asia. The industry, country, and regional level statistics provided by the book serve as a useful resource for taking stock of output, employment, trade, and investment in services in this region.

During the last decade, South Asia's five largest countries - India, Pakistan, Sri Lanka, Bangladesh and Nepal - have been implementing trade policy reforms, gradually moving their economies away from protectionism toward greater trade openness and global economic integration. In the late 1980s and early 1990s, the four mainland countries began to follow the liberalizing course on which Sri Lanka had embarked in the late 1970s. Each country faces differing opportunities to exploit and resistances to overcome. Because many of their circumstances and choices are similar, however, this paper seeks to assess their situations collectively as well as separately. Many of its findings are broadly applicable. So, with allowances for historic, economic and social differences, are many of its policy recommendations. The bulk of the report describes key aspects of the current trade regimes in the Jive largest South Asian states and the policies and practices that have produced the systems now in place. It principally focuses on traditional trade policies which affect imports and exports i.e. tariffs, non-tariff barriers, anti-dumping, export policies, and to a limited extent aspects of sanitary and technical regulations that affect trade. All of these are still major issues of concern and debate in South Asia. The report does not attempt to describe where the South Asian countries stand on newer trade policy issues which are prominent in World Trade Organization negotiations, such as trade in services, intellectual property, government procurement and Customs valuation. The report also does not attempt to place the South Asian countries' trade policies in the context of their trade and other aspects of their economic performance. Its purpose is rather to provide up-to-date information about, and interpretations of, the current trade policies it covers, with the idea that this should provide starting points for further applied economic research on useful and relevant topics, as well as points of reference and factual information for discussion and debate. Nevertheless, the report does assess, on theoretical and empirical grounds, the appropriateness of the policies described. Conclusions and suggestions for change are generally summarized at the end of each stocktaking section. This summary, in condensing the work of stocktaking, highlights the key issues that all or most of the countries have addressed and need to pursue further. To reinforce the operational nature of...

This book analyses the South Asian preferential trade agreements with reference to the WTO jurisprudence. It offers a comprehensive analysis of the factors undermining economic integration in South Asia and recommends possible ways for confronting them.

The services sector is key to economic growth, competitiveness, and poverty alleviation. Comprising more than two-thirds of the world economy, services are now commonly traded across borders, helped by technological progress and the increased mobility of persons. In recent years, a number of developing countries have looked at trade in services as a means to both respond to domestic supply shortages and to diversify and boost exports. Any country can tap into the trade potential of services, but not every country can become a services hub across sectors. The opening of the services sector potentially comes with large benefits, but also fears and costs that should not be overlooked. This book provides useful guidelines for the assessment of a country s trade potential, and a roadmap for successful opening and export promotion in select services sectors. It looks at both the effects of increased imports and exports, and provides concrete examples of developing country approaches that have either succeeded or failed to maximize the benefits and minimize the risks of opening. It focuses on sectors that have been rarely analyzed through the trade lens, and/or have a fast growing trade potential for developing countries. These sectors are: accounting, construction, distribution, engineering, environmental, health, information technology, and legal services. This book is designed for non-trade specialists to understand how trade can help improve access to key services in developing countries, and for trade specialists to understand the specific characteristics of each individual sector. It will be a useful tool for governments to design successful trade opening or promotion strategies, and for the private sector and consumers to advocate sound domestic policy reforms accompanying an offensive trade agenda.

This paper examines the gains for South Asian economies from integrating with East Asia and India's role in this process. Evidence of increased pan-Asian integration exists but the process is uneven. Bilateral trade has grown. As have bilateral foreign direct investment flows and free trade agreements (FTAs), albeit at a slower pace than trade. The integration process has been led by India and Pakistan with limited participation of smaller South Asian economies. Tackling key impediments in cross-border infrastructure, FTAs, trade barriers and business regulations, and barriers to services will foster further integration. Computable general equilibrium (CGE) simulations suggest that a South Asia-East Asia FTA offers the most gains for South Asia and that India has an incentive to include its neighbors in such an arrangement rather than going it alone with East Asia. The rest of South Asia will gain by deepening South Asian integration and fostering ties with East Asia.

South Asia has grown rapidly with significant reductions in poverty, but it has not been able to match the fast-growing working age population, leading to lingering concerns about jobless growth and poor job quality. Could export growth in South Asia result in better labor market outcomes? The answer is yes, according to our study, which rigorously estimates—using a new methodology—the potential impact from higher South Asian exports per worker on wages and employment over a 10-year period. Our study shows the positive side of trade. It finds that increasing exports per worker would result in higher wages—mainly for better-off groups, like more educated workers, males, and more-experienced workers—although less-skilled workers would see the largest reduction in informality. How can the benefits be spread more widely? Our study suggests that scaling up exports in labor-intensive industries could significantly lower informality for groups like rural and less-educated workers in the region. Also, increasing skills, and participation of women and young workers in the labor force could make an even bigger dent in informal employment. The region could achieve these gains by: (i) boosting and connecting exports to people (e.g., removing trade barriers and investment in infrastructure); (ii) eliminating distortions in production (e.g., by more efficient allocation of inputs); and (iii) protecting workers (e.g., by investing in education and skills).