The Structure and Composition of India’s Exports and Industrial Transformation (1980–2000)

Abstract

This paper analyses structural change in Indian manufactured exports empirically for 143 (mainly manufacturing) industrial groupings. Trade indices such as Balassa’s revealed comparative advantage (RCA) index and variants are used. Detailed econometric analysis is employed to examine structural change. The stability and the process of the intertemporal evolution of the RCA indices is considered. Three technology categories (high technology, medium technology and low technology) are analysed individually. Our results point towards substantial industrial restructuring in manufactured exports. We find evidence of despecialisation within India’s manufactured exports for the time period studied, which is consistent with increasing specialisation in a subset of manufactured exports.

Keywords:

• India
• comparative advantage
• manufactured exports

Acknowledgements

We would like to thank participants and discussants at the DRUID Conference, Elsinore, Denmark (June 2004) and the ETSG Annual Conference, Nottingham, UK (September 2004) for their helpful comments. The usual disclaimers apply.

Notes

¹The industries chosen for analysis as well as the technology groups are in listed in the Appendix 6, Table 7.

²See also, Brasili et al. (2000).

³Pavitt built upon the work of Soete (1980, 1987) who initially analysed the variance of RTA indices.

⁴Analogously, the extent of specialisation rises where , and it falls where .

⁵We use Eviews 4.1, EViews 5 and Stata 8.1.

⁶The complete regression output is available from the authors.