This paper attempts to examine the trade performance of five SAARC member countries (Pakistan, India, Bangladesh, Sri Lanka and Nepal) and its impact over the macroeconomic structure of their economies during 1989 to 2001.The paper basically focuses on intra SAARC trade in the light of free trade agreements which encourage trade liberalization process among SAARC countries. The data provides substantial evidence, which shows the benefits of intra-regional trade expansion: larger markets and fuller utilization of production capabilities, transfer of suitable production technologies, comparative advantage and complementarities, economies of scale due to expanded markets and better utilization of entrepreneurial capabilities, capital, manpower and natural resources. In addition to that such an arrangement is also expected to foster closer economic ties among member countries and enhance their bargaining power with respect to other countries and economic blocs.
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Copyright (c) 2011 Dr. Rummana Zaheer