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| Abstract: Unlike other studies on the pharmaceutical trade in India, this study analyses India’s pharmaceutical trade for a longer time period, focusing on destination-wise analysis and calculating the intra-industry trade index while taking care of the problem of categorical aggregation—also, the study attempted to find the long-run association with production-related drivers. The purpose of the paper is to examine the trade structure of India’s pharmaceutical sector with a focus on intra-industry trade (IIT). This study analyses export destinations and imports sources using significant trade shares. The study calculates IIT between India and its significant trade partners both at an aggregate level and considers the problem of categorical aggregation at the disaggregate level. To find the determinants of IIT at different levels, the Vector Error Correction model used production-related data to identify the drivers of IIT. Also, the Granger causality test was used for short-run causality. This study, examining India’s consistent trade partners from 1993 to 2023, finds long-term relationships and short-run dynamics through Granger causality tests. The results show a significant long-run association between total IIT and factors like unskilled labor share, invested capital, fuel consumption, and net value added. The key drivers for low-vertical IIT (LVIIT) are invested capital, unskilled labor, fixed capital, and total inputs. Short-run causality indicates that total IIT is influenced by invested capital and fuel consumption, while LVIIT is driven by unskilled labor share and total inputs. Both IIT types impact invested capital, highlighting the need for policy intervention in input markets. It provides insights for improving quality trade expansion and correcting production-related factors. |
| Date: Friday, 30th January 2026 from 3.30 PM onwards Register here: https://forms.gle/USAHWzQimMrURhi29 Meeting ID: 813 2538 7213 | Passcode: 20260130 (Online Mode) |