Abstract

The analysis of comparative advantage has been undertaken using the Balassa (1965) index of revealed comparative advantage for six-digit level of Harmonized System classification. This study analyses the competitiveness and the pattern of trade flows from India to SAARC member countries. Regional integration in SAARC has significantly affected trade patterns, comparative advantage and competitiveness. The paper examines India's relative advantage in various commodities with SAARC countries through export and import comparative advantage. The study finds that commodities such as coal, coke and briquettes, motor vehicles, and medicinal and pharmaceutical products have high to very high competitive advantages in exports to SAARC countries. India also has comparative advantages in imports of animal feeding stuff, crude animal and vegetable materials, and vegetables and fruits. The study concludes that there is further scope for increasing India's trade with SAARC members and recommends stronger policy initiatives to promote regional trade.