Regional Positioning and Identity Formation in East Asian Trade: Comparing China and India

Abstract

AbstractThis paper explores the relative regional positions of China and India from a geo-economic perspective. The findings of this paper give rise to two important observations. First, the core economic factors driving trade partnerships appear to be, by and large, in the import rather than in the export domain. This suggests that import activities of China from the region depend more on the characteristics of the East Asian partners than export does. In contrast, the core economic factors, such as combined market size and FDI stocks, coupled with similar demand patterns and different factor intensities, are important for generating exports from India to East Asia. Second, though China and India have regional roles as demanders (importer) and suppliers (exporter) of merchandise goods, the differences in the relative positions of the two countries stand out from the supplier perspective. China appears to exert a much larger role as a supplier relative to India to fuel economic interdependence in East Asi...