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Chemical industry plays a vital role in the functioning of most of the key sectors of an economy which includes agriculture, infrastructure, healthcare, textiles among others. This paper attempts to analyse the dynamics of international trade in chemical sector both at the macro and micro level for the period 2012, 2013 and 2014. The study has also looked into export potentiality and competitiveness of Indian chemical products in international market with special emphasis to FTA markets. An attempt is also made to study in depth the trade structure of these products, how far erosion of protection is pronounced and the extent FTA partners are responsible for India’s rising imports. In case of implication of FTA, erosion of ‘effective rate of protection’ has been looked into. Further, several trade indices have been calculated both on import and export data to understand quality of exported and imported products, possibility of exploiting economies of scale, extensive and intensive margins, degree of concentration both at product and country level, revealed comparative advantage and possibility of intra-industry trade. The paper conducts an in-depth analysis on selected products to demystify the strengths, weaknesses, opportunities, and threats to Indian chemical industry in the world, especially putting the lens on various FTA groups.

Augmented Footprint of Free Trade Agreements (FTAs) in India: An Empirical Analysis of Indian Chemical Industry