Innocent Bystanders

Implications of an EU–India Free Trade Agreement for Excluded Countries

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Innocent Bystanders
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Publication date: 1 February 2009
Size: 240mm x 165mm
ISBN: 978-0-85092-895-2
Pages: 122

The European Union, under its ‘Global Europe’ initiative, has since 2006 been pursuing trade agreements with its major global trading partners. An EU–India Free Trade Agreement is currently under negotiation; if successfully concluded it is likely to have knock-on effects on other countries’ trade with both India and the EU, the trade of the ‘innocent bystanders’ excluded from the agreement.

The authors consider the implications of the EU–India Free Trade Agreement for various groups of other countries, including the ACP countries and those in South Asia, the latter group being most strongly impacted. The analysis considers not only trade in goods but also trade in services, and focuses not only on quantities but also on the prices at which trade is conducted.

The authors then consider how excluded countries might respond to the Free Trade Agreement, both at an individual level and at a systemic level.

ContentsExpand or collapse me

List of tables and figures
List of abbreviations

Introduction and summary  

Part I. Background

1. The effects of preferential trading arrangements (PTA) on excluded countries: Welfare not quantities
The price effects of a PTA                        
Many markets                        

2. EU Trade Agreements: What can we expect an EU–India Agreement to cover?                        
A brief history                        
‘Global Europe’                        
EU–India FTA                        
Government procurement                        
Trade facilitation                        
The prospects for agreements on elements of deep integration                        

3. The effects of a potential EU–India FTA on the EU and India                        
Shallow integration                        
Deep integration                        
General equilibrium modelling results                        

Part II. Excluded Countries and the Markets for Goods

1. Trade similarity

2. Trade diversion and trade re-orientation: Aggregate analysis                        
EU preferences                        
India preferences

3. Trade diversion and trade re-orientation: Sectoral analysis                        
EU preferences                        
India preferences

4. Terms of trade effects                        
Terms of trade effects in the EU market                        
Terms of trade effects in the Indian market                        
Trade competitiveness pressure index                        

Part II. References  

Part III. Services

1. The importance of services in a potential EU–India FTA
2. Barriers to services trade between EU and India, and areas of interest in a possible FTA
3. The coverage of services in FTA
4. The welfare effects of preferential services liberalisation
5. Specific case studies from EU–India
6. The role of investment
7. Conclusion                        

Part III. References  

Part IV. Policy responses

1. Individual excluded countries
2. Multilateral responses                        

Part IV. References  


About the contributors Expand or collapse me

L Alan Winters (Author)

L Alan Winters is professor of economics at the University of Sussex, UK, and was in 2008 appointed chief economist at the UK's Department for International Development.