Regional trade expansion opportunities in Central and South Asia: exploring trade complementarity, diversification and similarity

Abstract

The study investigates the implementation of trade routes and their impact on the regional economic integration of Central and South Asia. It uses three indices, the Trade Complementarity Index (TCI), Similarity Index (SI), and Trade Diversification Index (TDI), to evaluate the level of regional economic integration from 2015 to 2021. The results suggest that the potential trade value in the two regions is twice as significant as the actual level. The study also highlights the importance of various governmental measures to promote and enhance trade and investment within and between the two regions. The study finds a positive correlation between an economy’s size and level of development, suggesting that developed economies tend to have higher ratings. Several trade routes have shown advantages in promoting regional trade growth, such as augmenting price competitiveness, facilitating intra-industry trade and examining trade complementarities. The implications of these findings are significant for the effectiveness of trade-related policies, programs and institutional procedures in promoting enhanced trade within and between the two regions.

Impact statement

The study contributes to the empirical literature in such a way as to provide (a) practical knowledge and methods for businesses to take advantage of Central and South Asia regional opportunities; (b) analytical tools for policymakers and researchers; and (c) policy and program recommendations for governments and development partners. It should be of interest to businesses, governments, international development partners, policymakers and researchers, and others concerned with Central and South Asia’s trade and the potential for developing value chains or so-called ‘trade in tasks’ across the two regions.

Keywords:

• South Asia
• Central Asia
• trade complementarity
• diversification
• similarity

JEL Codes:

• F11
• F13
• F17

Reviewing Editor:

• Goodness Aye, University of Agriculture, Makurdi Benue State, Benue, Nigeria

Subjects:

• International Trade (incl. trade agreements & tariffs)
• Development Economics
• International Economics

Authors contribution

The authors confirm their contribution to the article as follows: study conception and design: NHW; data collection: MMR; analysis and interpretation of results: NHW, AUR, VG and SM; draft manuscript preparation: NHW and MMR. Revisions: NHW, AUR, VG, SM and MMR; All authors reviewed the results and approved the final version of the manuscript.

Disclosure statement

The authors declare that the research was conducted in the absence of any commercial or financial relationships that could be construed as a potential conflict of interest.

We declare that the work described has not been published previously (except in the form of an abstract, a published lecture or an academic thesis, see ‘Multiple, redundant or concurrent publications’ for more information), that it is not under consideration for publication elsewhere, that its publication is approved by all authors and tacitly or explicitly by the responsible authorities where the work was carried out, and that, if accepted, it will not be published elsewhere in the same form, in English or any other language, including electronically without the written consent of the copyright holder.

Data availability statement

The data that support the findings of this study are available at demand. These data were derived from the resources available in the public domain: (UNCOMTRADE, WITS, OEC and World Bank).

Additional information

Notes on contributors

Nassir Ul Haq Wani

Dr. Nassir Ul Haq Wani did his PhD in International Business and Trade from Mittal School of Business, Lovely Professional University (LPU) India. Dr. Wani is the Director of the Department of Research and Development (DRD) at Kardan University (ACBSP and IACBE Accredited), Kabul, Afghanistan. Dr. Wani is a distinguished author and has primarily written on Afghanistan’s economy, BRICS, SAARC, Central Asia and ASEAN. His book “Policy Solutions for Economic Growth in a Developing Country: Perspectives on Afghanistan’s Trade and Development” is a well-researched book published by Emerald Publishing, UK. He has served in South and Central Asia private and public sector universities. He has published over 60 research papers, articles and commentaries in world-class journals indexed in WoS, Scopus, ABDC, Kardan Publishing and Scimago. Credited with a decade of rich academic and research experience, he has been involved in several training and consultancy projects as a lead author in research-related issues funded by the World Bank, KMF, USAID, and HEDP.

Afzalur Rahman

Dr. Afzalur Rahman is a Professor at the School of Commerce, Presidency University, Bengaluru, Karnataka. Dr Afzal has over 12 years of teaching experience and is an expert in Accounts, Finance and Data Analysis using Python and Go. Dr. Afzalur Rahman is a highly accomplished professor in the School of Commerce with extensive experience in academia and business. With a strong educational background and a passion for financial education and analysis, Dr. Rahman has made significant contributions in both teaching and research. He possesses a diverse skill set, including expertise in algorithmic trading, programming languages, database management, cloud technology, and accounting packages.

Veena Grover

Dr. Veena Grover is currently working as a Professor in the Department of Management at Noida Institute of Engineering & Technology, Greater Noida, UP, India. Before this, she worked as a Professor at the School of Business, Galgotias University, she has more than 15 years of teaching experience in educational institutions of repute like Lingaya’s University, New Delhi Institute of Management, University of Delhi, DAV Institute of Management etc. She is a Gold Medalist & University topper in Economics. She has received many appreciation letters for her teaching & administrative skills over the years. Her research interests include microfinance, higher education, sustainability, macroeconomics and innovation strategy. She is also an adjunct thesis supervisor at Westford University, UAE. Her influence extends to the global academic stage, where she has been invited as a distinguished panelist, keynote speaker, and session chair at several prestigious conferences, summits, and seminars. A prolific researcher, Professor Grover has contributed significantly to the academic discourse by presenting and publishing more than 35 research papers and book chapters in international and national conferences, as well as reputable refereed journals. She serves as an Editor of the refereed journal, International Journal of Advanced Trends in Technology, Management & Applied Science. Dr. Veena Grover earned her PhD from the Department of Business Administration, Deenbandhu Chhotu Ram University of Science & Technology, Murthal (Sonepat).

Shoira Mirzakhidova

Shoira Mirzakhidova is working as Head of Academic Support Services at Westminster International University in Tashkent (WIUT). Her key responsibilities are to plan and organize all the services necessary to support the academic excellence of WIUT students. This involves identifying areas where in-class instruction is insufficient and providing additional support for students from the specific environment of Uzbekistan.

Mohammad Mirwais Rasa

Mr. Mohammad Mirwais Rasa is a graduate of the MBA program from Kardan University, Kabul Afghanistan. Having a bachelor’s degree in Geoscience from Kabul University and a diploma in accounting and finance from NIMA, Kabul Afghanistan. Mr Mirwais Rasa possesses six years of experience in finance, administration, data collection, and analysis. Currently, Mr. Mirwais is working at BMA (Bank Millie Afghan) as Secretary to CEO.