Towards An Asian Economic Community 

RIS started this major research project, 'Towards an Asian Economic Community' in October 2001 as a part of the Sasakawa Peace Foundation (SPF's) Research Programme on Future of South Asia: Institutional and Structural changes, also involving the Malaysian Institute for Economic Research and Centre for Strategic and International Studies (CSIS), Indonesia and Reitaku University, Japan. 

The project finds a compelling case for an Asian Economic Community (AEC) that would be broader in coverage than the current programmes for economic cooperation in different sub regions such as East Asia, South Asia and Central Asia, Such a grouping would facilitate fuller exploitation of the region's considerable resources - material as well as human - for expediting the process of its development. 

Further Details can be had from Dr Nagesh Kumar (nkumar@ris.org.in) 

A Feasibility Study on A Free Trade Agreement between India and Thailand

This study was conducted by RIS in collaboration with Faculty of Economics, Chulalongkorn University, Bangkok. It has been completed and adopted by the Inter-governmental Joint Working Group (JWG) between India and Thailand at its final meeting held in December 2002. 

It assesses the impact of FTA at the macro and sectoral levels both through a computable general equilibrium model (CGE) and other techniques. A broad architecture of the FTA is also recommended in the Study. The Study formed the basis for the discussions in the First Meeting of the Joint Negotiating Group (JNG) fro Drafting a Framework Agreement on India- Thailand FTA during December 23-24, 2002 in Bangkok.

Further Details can be had from Dr. Ram Upendra Das(upendra@ris.org.in) 

Future Directions of BIMST- EC

At the last Ministerial meeting  of BIMST-EC, held in Yangon in December, 2002, India had proposed that RIS, on consultation with other think tanks and other relevant institutions in BIMST-EC countries, would develop ideas on the future direction and priorities for cooperation in BIMST-EC. 

At the suggestion of the Indian Ministry of External Affairs, RIS prepared a paper. " Economic Cooperation in the Framework of BIMST-EC" to facilitate discussions of the Indian delegation at the BIMST-EC Working Group. The paper, which is seen as a think tank input into the evolving BIMST-EC process, has been circulated among the member countries. The paper outlines cooperation in the area such as implementation of regional FTA, investment promotion and protection agreement, taxation avoidance agreement, attracting extra-regional sources of FDI, BIMST-EC Fund for regional projects, harmonization of custom procedures and transit documentation, clearance and payment arrangements and local currency trading and regular interactions among think tanks.

Further details can be had from Dr Nagesh Kumar (nkumar@ris.org.in) 

Relevance of Asian Bonds 

RIS made comments on the Thai proposal of Asian Bonds at the request of the Ministry of External Affairs.

Further details can be had from Dr Nagesh Kumar (nkumar@ris.org.in) 

Closer Economic Cooperation with Neighbouring Countries

At the request of the Ministry of External Affairs, Government of India, RIS prepared a comprehensive Concept Note on Initiative for Closer Economic Cooperation with Neighbouring Countries in South Asia. The RIS Note makes a number of proposals for strengthening of trade and investment links for consideration of the Task Force set up by the External Affairs Minister to examine these issues. These proposals include FTAs with Bangladesh and Myanmar, fostering industrialization in South Asian countries, mobilization of extra-regional sources of FDI, recycling of trade surpluses for investment, harmonization of customs procedures and documentation, transport and transit facilities, infrastructure development, clearance and payment arrangements and local currency trading, increasing value addition, dealing with emerging SPS measures and TBTs, etc. The Note also has a detailed annexures on potential of intra-regional trade and sectors of cooperation, analysis of experiences with regional cooperation, and infrastructure development.

Further details can be had from Dr Nagesh Kumar (nkumar@ris.org.in) 

Intra-Regional Trade Liberalisation in South Asia - SAPTA and SAFTA

RIS completed a study on a SAARC Preferential Trading Arrangement (SAPTA) prepared at the request of UN-ESCAP as a contribution for its Expert Group Meeting on Regional Trade Agreements in Asia and the Pacific. The study examines the status of trade flows among SAPTA member countries and assesses to what extent the Agreement has contributed to boosting of intra-member trade flows. The study also discusses other agreements, including bilateral trade agreements, to which SAPTA member countries are party to, and the effects of these agreements on intra-SAPTA trade flows. Further, it assesses the potential economic impact of recently offered concessions as well as further trade liberalization between SAPTA member countries. The study was presented at the UNESCAP Expert Group Meeting on Regional Trade Agreements in Asia and the Pacific, held in Bangkok on January 30-31, 2003.

RIS also has another study on trade liberalization in South Asia conducted by Professor I.N. Mukherjee of Jawaharlal Nehru University, that is being finalized. Contact for further details, skmohanty@ris.org.in

Further details can be had from Mr. S.K Mohanty (skmohanty@ris.org.in) 

Towards A Free Trade Area in South Asia: Charting A Feasible Course for Trade Liberalization with Reference to India's Role 

This study has been conducted within the framework of the SAARC Network of Researchers. This study has attempted to examine the impact of SAPTA on bilateral preferential trade flows on conceded products both from the point of view of India’s imports as well as exports since SAPTA negotiations were implemented by the end of 1995. The study shows that import liberalization by India has stimulated preferential imports from Bangladesh both in value and share terms but imports from Sri Lanka show no such buoyancy. A first draft of the study has been completed. It will be finalized soon with the revision and updation with more recent data that has become available. 

Economic Cooperation with Central Asian Republics

RIS had organised a discussion meeting on "Towards Sustained Growth in Kazakhstan: Potentials of Economic Cooperation" on October 24, 2002. It was followed up with a discussion meeting on "Economic Cooperation between India and Central Asian Republics with special reference to Uzbekistan", organized on May 28, 2003. Thereafter a number of policy papers are being prepared on India-Central Asia Cooperation. RIS is launching, in collaboration with Confederation of Indian Industry (CII), a work programme on India-Central Asia Economic Relations. The work programme covers preparation of a number of research/policy papers and organization of seminars in Delhi and Mumbai with trade and industry representatives. 

Further details can be had from Dr Ram Upendra Das (upendra@ris.org.in) 

Economics of Regional Integration in Asia: A CGE Modelling Approach 

The study examined the implications of deeper level of economic liberalisation between ASEAN and other four Summit level countries within the framework of a Computable General Equilibrium (CGE) model. The study focuses on the consequences of the proposed FTA on the ASEAN+3+1. The study is also examining the effects of further liberalisation within the regional partners in the form of free movement of investment and natural persons along with FTA on these countries. The study has incorporated monopolistic competition in the model with the assumption that manufacturing sector is subject to monopolistic competition whereas other sectors operate under the conditions of perfectly competitive environment. The results of the study indicate that the FTA among JACIK countries would enhance both regional and global welfare. A comprehensive FTA, allowing investment and natural persons to move freely, would effectively enhance regional welfare than mere trade liberalisation under FTA. A study was presented in the 6th Annual International Conference on Global Economic Analysis, held in the Hague, on 12-14 June 2003. 

Further details can be had from Mr. S.K Mohanty (skmohanty@ris.org.in) 

Trade Complementarities and Potential for a Single Currency in JACIK

This study examines the existence of the economic criteria for a common currency in Asia covering Japan, ASEAN, China, India and Korea (JACIK) in the context of RIS research on the Asian Economic Community. The analysis in this paper shows that significant complementarities in trade exist among JACIK countries. Most of them experience similar shocks and labour mobility is already present. These results point to the fact that the cost of adopting a single currency may be minimal, while huge benefits could accure from enhanced trade. The study was conducted by Dr. Sweta Chaman Saxena, Assistant Professor, GSPIA, University of Pittsburg, USA, while working at RIS as a Visiting Fellow during May-June 2003. A revised version will be brought out in RIS Discussion Paper Series.

 Further details can be had from Dr Sweta Chaman Saxena (ssaxena@pitt.edu) 

India-Sri Lanka Comprehensive Economic Cooperation Agreement 

India and Sri Lanka had launched a bilateral FTA in 1998 which became operational in 2000. Encouraged by the good experience with FTA in expanding the mutual trade in an equitable and balanced manner, the two governments decided to expand the scope of economic cooperation to cover investment and services in the framework of a Comprehensive Economic Cooperation Agreement (CECA). A Joint Study Group (JSG) was set up to prepare a blue print of CECA. The Indian Ministry of External Affairs requested RIS to prepare a study on investment for discussions at the Joint Group Meeting. Accordingly, RIS prepared a study on Investment Relations between India-Sri Lanka: Some Analyses and Policy Recommendations and submitted it to the Ministry of External Affairs on July 17, 2003.

Subsequently the Ministry of External Affairs requested RIS to prepare a draft of the investment chapter for the Joint Study Group Report, based on Indian submissions as well as Sri Lankan submissions on the subject. RIS, based on these inputs, prepared an integrated study on India-Sri Lanka Investment Partnership and submitted it to the Ministry of External Affairs on July 26, 2003 for the JSG. The JSG has since concluded its work and finalized its Report at its Meeting held in Candy, Sri Lanka on October 6, 2003.

A Framework Agreement on FTA between India and Thailand 

RIS has prepared a joint feasibility study on A Free Trade Agreemeent (FTA) between India and Thailand. Apart from this, RIS has been providing inputs and consultations to the Ministry of Commerce on negotiations of the Indo-Thai Bilateral FTA. These also included inputs on India's offer list of products. RIS provided comments on Draft Rules of Origin under India-Thailand Free Trade Agreement to Ministry of Finance, Government of India, September 11, 2003. RIS also prepared a policy note on Rules of Origin (RoO) Provision for the Draft Framework Agreement on India-Thailand FTA and submitted to the Ministry of Commerce on September 23, 2003.

Monetary Cooperation in South Asia: Potential and Prospects 

The broad objective of the study examines the potential and prospects of monetary cooperation in South Asia. It discusses the rationale for monetary integration, examines the feasibility of Optimum Currency Area (OCA) in the region and makes some policy recommendations. Another contribution on the subject prepared at RIS is a policy note on the single currency in South Asia that proposes a way forward for a currency union with a parallel currency to begin with. Both the papers were presented at RIS/SACEPS Seminar on Monetary Cooperation in South Asia held in New Delhi on December 23, 2003. 

Further details can be had from RIS (dgoffice@ris.org,in) 

Bangladesh-India-Myanmar-Sri Lanka-Thailand Economic Cooperation (BIMST-EC) is a sub-regional grouping combining some geographically contiguous South Asian and ASEAN countries in the Bay of Bengal.

RIS, in consultation with the Institute for Policy Studies, Colombo; International Institute for Trade and Development, Bangkok; and Centre for Policy Dialogue, Dhaka, prepared the study Future Directions of BIMST-EC: Towards a Bay of Bengal Economic Community (BoBEC), as per the mandate provided by the Fourth BIMST-EC Ministerial Meeting held in Yangon on December 21, 2001. The study was made available for the BIMST-EC Ministerial Meetings held in Phuket, Thailand on February 7-8, 2004.

RIS study presents some thoughts on the future directions of the Grouping. It discusses issues concerned with BIMSTEC countries: characteristics and recent economic performance; economic cooperation for development and competitiveness; transport infrastructure and linkages; energy cooperation: towards a bay of Bengal energy community; and other sectors of cooperation.

It recommends that the grouping should set its goal to form a Bay of Bengal Economic Community by the year 2020. To facilitate the flow of intra-regional investments, there is need for pursuing investment liberalization on a negative list basis and also incorporate provisions of double taxation avoidance in the Framework Agreement. A BIMSTEC Fund for Regional Projects should also be established for further strengthening of business links.

There could also be fruitful cooperation between the BIMSTEC countries in technology management and capability building, in dealing with the digital divide, among other areas. BIMST-EC needs an institutional structure to follow up the decisions taken by the Ministerial Conferences and the Summits and for preparing the agenda of different meetings. The energy demand-supply sectors in the countries of Bangladesh, India, Myanmar, Sri Lanka, Thailand, Nepal and Bhutan offer a potential for regional resource cooperation, which could go beyond export-import trade relations and link the region in a Bay of Bengal Energy Community and thus contribute to the process of regional integration. Cooperation should also be promoted in tourism, fisheries, auto, SMEs and other sectors. To facilitate the exchange of development experiences, a BIMSTEC Network of Policy Think-Tanks of the region could be created. 

Further details can be had from RIS (dgoffice@ris.org,in) 

In light of Millennium Development Goals and declaration at World Food Summit (WFS), FAO assigned RIS a major study to look into the possibilities for regional and sub-regional cooperation in Asia to address poverty, food security and sustainable agriculture and rural development. The RIS study outlined a strategy to facilitate achievement of a common understanding and modalities for addressing the regional challenges by fostering discussion of the linkages between action by the Sub-Regional Economic Organizations (SREOs) and Regional Organizations (ROs), ADB, the UN Systems including ESCAP and FAO and Civil society organizations.

FAO organized a two-day Regional High Level Roundtable on Regional Programmes and Cooperation for Eradication of Poverty and Food Insecurity in Asia and the Pacific on February 23-24, 2004 at Bangkok, Thailand. The Meeting was organized in collaboration with UNESCAP and ADB. The Meeting offered a chance for SREOs to build on their mandate for sub-regional economic integration so as to explore how they can promote the convergence of various initiatives in the region.

The RIS study was presented as a background note at the Meeting. The Meeting was attended by several ministers, UN agencies and representatives from SAARC, ASEAN, and civil society organizations. 

Further details can be had from Dr Sachin Chaturvedi (sachin@ris.org.in)

Regional Cooperation for Energy Security in Asia

Energy consumption of developing Asian economies like India, China, South Korea, Indonesia and Thailand are increasing rapidly. To meet this increasing demand for energy, these emerging economies will have to increase and diversify their domestic supplies and sources of energy—both conventional as well as non-conventional. Some of the options that are available to India are: discovering new energy sources in the country; increasing energy import and diversifying sources of import; demand side management and improvements in efficiency of energy use and diversifying to alternative energy forms. In this regard, India needs to explore cooperation possibilities with the new economies of Central Asian countries, which have vast resources of oil and natural gas, with the immediate neighbours in the BIMST-EC countries for exploration and exploitation of their abundant natural gas and renewable energy resources and with ASEAN countries, China, Japan and Korea for Asian energy and economic cooperation through the creation of emergency energy network; joint management of strategic oil reserves, development of a natural gas market in Asia and improvement of energy efficiency and renewable energy. The RIS study explores into India’s energy cooperation possibilities with other countries

Further details can be had from Ms Barnali Nag (barnali@ris.org,in)