Kathuria, Sanjay

Person:
Kathuria, Sanjay

Macroeconomics, Trade, and Investment Global Practice

Fields of Specialization

economic growth, economic integration, international trade policy, economic competitiveness, fiscal policy, technology development, financial sector development, gender and development

ORCID

0000-0003-3258-6125

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Macroeconomics, Trade, and Investment Global Practice

Last updated: January 31, 2023

Biography

Sanjay Kathuria is Adjunct Professor, Georgetown University; Visiting Faculty, Ashoka University; Senior Visiting Fellow at the Centre for Policy Research, India; and Non-Resident Senior Fellow at the Institute of South Asian Studies, Singapore. Earlier, he was a Lead Economist at the World Bank in Washington, D.C. Sanjay Kathuria is one of the leading thinkers and commentators on economic integration in South Asia and the economic development of the region. In 27 years at the World Bank, from 1992 to 2019, he worked in South Asia, Latin America and the Caribbean, and Eastern Europe, including field assignments in New Delhi and Dhaka. Before joining the World Bank, he was a Fellow at the Indian Council for Research on International Economic Relations in New Delhi, from 1982-1992.

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Publication Search Results

Now showing 1 - 10 of 13

A Glass Half Full: The Promise of Regional Trade in South Asia
(Washington, DC: World Bank, 2018-09-19) Kathuria, Sanjay; Kathuria, Sanjay
Trade has played a critical role in global poverty reduction. In harnessing the potential of trade, some of the most successful countries have developed strong trade relationships with their neighbors. However, many South Asian countries have trade regimes that often offset the positive impact of geography and proximity. This report documents systematically the gaps between current and potential trade in South Asia and addresses important specific barriers that have held trade back. These barriers include tariffs and paratariffs, real and perceived nontariff barriers, connectivity costs, and the broader trust deficit. This policy-focused report unpacks these critical barriers to effective trade integration in South Asia through four in-depth studies that produce new, detailed, on-the-ground knowledge. Three of the studies are based on extensive stakeholder consultations. Two also rely on tailored surveys. The fourth study, on tariffs, benefits from new data on paratariffs. The report also marshals new evidence showing how trading regimes in South Asia discriminate against each other. Given the South Asian context, incremental, yet concrete steps aimed at tapping the potential of deeper integration are appropriate. The report has been drafted in this spirit. It offers precise, actionable policy recommendations that could help achieve measurable progress in key areas of trade and integration that would be to the advantage of all countries in the region.
Regional Investment Pioneers in South Asia: The Payoff of Knowing Your Neighbors
(Washington, DC: World Bank, 2021-11-17) Kathuria, Sanjay; Zhu, Xiao’ou
Regional economic engagement within South Asia may gain increasing importance owing to several factors that are currently in play, including strategies to diversify global value chains and locate such value chains nearer home. These developments offer South Asia a chance to enhance its low levels of regional economic engagement and capitalize on significant unrealized development opportunities. This report shows that examining intraregional investment and knowledge connectivity enhances our understanding of the low levels of intraregional trade and limited regional value chains in South Asia. Creating a new and unique data set for South Asian investment, it provides a detailed and nuanced understanding of the drivers of outward investment, both regional and global, for South Asian firms. “Regional Investment Pioneers in South Asia” provides key considerations for policy makers in South Asia, which remain particularly relevant in the aftermath of the pandemic. First, it makes a case for regulatory relaxation of outward FDI regimes, based on new micro foundations, grounded in value chains. Second, it spells out details of smart inward FDI promotion techniques and investment facilitation. Third, it identifies distinct cross-border information-enhancing and network development activities. Fourth, it suggests that digital connectivity and continued interventions in reducing trade costs are warranted to increase investment as well as trade flows. There is particular scope to build on the digitalization initiatives in trade and investment facilitation taken during the pandemic. “Regional Investment Pioneers in South Asia” follows on, and is complementary to, the earlier World Bank report, “A Glass Half Full: the Promise of Regional Trade in South Asia.”
Attracting Investment in Bangladesh—Sectoral Analyses: A Diagnostic Trade Integration Study
(Washington, DC: World Bank, 2016-10-13) Mezghenni Malouche, Mariem; Kathuria, Sanjay; Kathuria, Sanjay; Mezghenni Malouche, Mariem; Chanda, Rupa; Dausendschoen, Kay; Elbert, Christine; Gessese, Nebiyeleul; Konishi, Yasuo; Raihan, Selim; Rizwan, Nadeem; Surabian, Glenn; Veliu, Atdhe
This is volume 3 of a three-volume publication on Bangladesh’s trade prospects. Bangladesh’s ambition is to build on its very solid growth and poverty reduction achievements, and accelerate growth to become a middle income country by 2021, and share prosperity more widely amongst its citizens. This includes one of its greatest development challenges: to provide gainful employment to the over 2 million people that will join the labor force each year over the next decade. Moreover, only 54.1 million of its 94 million working age people are employed. Bangladesh needs to use its labor endowment even more intensively to increase growth and, in turn, to absorb the incoming labor. The Diagnostic Trade Integration Study identifies the following actions centered around four pillars to sustain and accelerate export growth: (1) breaking into new markets through a) better trade logistics to reduce delivery lags ; as world markets become more competitive and newer products demand shorter lead times, to generate new sources of competitiveness and thereby enable market diversification; and b) better exploitation of regional trading opportunities in nearby growing and dynamic markets, especially East and South Asia; (2) breaking into new products through a) more neutral and rational trade policy and taxation and bonded warehouse schemes; b) concerted efforts to spur domestic investment and attract foreign direct investment, to contribute to export promotion and diversification, including by easing the energy and land constraints; and c) strategic development and promotion of services trade; (3) improving worker and consumer welfare by a) improving skills and literacy; b) implementing labor and work safety guidelines; and c) making safety nets more effective in dealing with trade shocks; and (4) building a supportive environment, including a) sustaining sound macroeconomic fundamentals; and b) strengthening the institutional capacity for strategic policy making aimed at the objective of international competitiveness to help bring focus and coherence to the government’s reform efforts. This third volume provides in-depth analysis of eight different manufacturing and services sectors of the Bangladeshi economy, which help to illustrate the thematic analysis of volume 2 and ground it in sector experiences. Besides pointing to cross-cutting themes, the analysis also highlights some specific issues and actions that could help relieve constraints to faster export growth in these sectors.
Unleashing E-Commerce for South Asian Integration
(Washington, DC: World Bank, 2020) Perego, Viviana Maria Eugenia; Kathuria, Sanjay; Mattoo, Aaditya; Grover, Arti; Banerjee, Pritam; Mattoo, Aaditya
This report is part of a broader work program on shaping a more positive narrative on regional integration in South Asia. It is a follow-up to a recent flagship report published by the South Asia Region of the World Bank, A Glass Half Full: The Promise of Regional Trade in South Asia. E-commerce is dramatically changing the way goods and services are transacted nationally, regionally, and globally. It facilitates international trade by reducing the cost of distance and remoteness and can be more inclusive of underrepresented groups such as women, small businesses, and rural entrepreneurs. Intraregional trade in South Asia is still below its potential, and the region lags behind other parts of the world in activating the potential benefits from e-commerce. Adopting a novel yet practical approach, this report explores how e-commerce can be boosted to deepen intraregional trade in South Asia. It examines the main transacting models in the digital space and the channels through which e-commerce helps reduce transactions costs for firms and consumers. It considers the regulations, as well as the regulatory gaps, affecting private sector participation in e-commerce, focusing on data privacy, consumer protection, delivery, cybersecurity, market-access regulations, and digital payments. Finally, the report presents recommendations for regulatory reforms that could enhance e-trade, especially in a regional context and as a possible platform for greater global engagement by South Asian firms. The scale of these recommendations ranges from the modest, such as allowing cross-border payments and streamlining the customs regime, to the more ambitious, such as allowing the operation of regional e-commerce platforms and liberalizing related cross-border logistics services.
Playing to Strengths: A Policy Framework for Mainstreaming Northeast India
(Washington, DC: World Bank, 2020) Mathur, Priya; Kathuria, Sanjay; Kathuria, Sanjay; Mathur, Priya; De, Prabir; Jensen, Michael Friis; Kunaka, Charles; Srinivasan, Thirumalai G.
It is widely agreed that, over the past decade, accelerating infrastructure investments in India's North Eastern Region (NER) and neighboring countries, along with connectivity agreements with Bangladesh, hold immense promise for unlocking NER's economic potential. Other global trends, such as the growing incomes and consumer awareness in India and neighboring countries; a rising preference for fresh, healthy, safe, environmentally friendly, and socially responsible products; the growing role of services in manufacturing; and increasing demand for skilled resources are also very favorable for NER. Together, these developments can help NER showcase its strengths in agriculture and services, thereby developing value chains in these sectors, which will lead to sustainable, better-paying job opportunities for the people of NER. In this context, the World Bank, in consultation with stakeholders--government, private sector, and academia--analyzed two cross-cutting constraints that are encountered across all value chains and sectors in NER: connectivity and logistics, and product standards and quality infrastructure. To ground the policy in specific contexts, the team studied four sectors in depth: fruits and vegetables, spices, bamboo and related products, and medical tourism. Playing to Strengths lays out an initial policy framework for NER that integrates demand and supply and shows that, even with a low base in manufacturing, NER can leverage its strengths in agriculture and services to step up its growth. However, implementing this framework will require a different approach to doing business compared with the existing ecosystem and its associated value chains, which are mostly geared to local and/or price-conscious consumers. In capitalizing on its advantages, NER will not only accelerate its own development, but also will play an increasingly critical role in the government of India's "Act East" policy.
Strengthening Cross-Border Value Chains: Opportunities for India and Bangladesh
(Washington, DC: World Bank, 2020) Kathuria, Sanjay; Kathuria, Sanjay; Mathur, Priya; Gitau, Ciliaka Millicent W.; Khanna, Aman; Manghnani, Ruchita
It is widely agreed that, over the past decade, accelerating infrastructure investments in India's North Eastern Region (NER) and neighboring countries, along with connectivity agreements with Bangladesh, hold immense promise for unlocking NER's economic potential. Other global trends, such as the growing incomes and consumer awareness in India and neighboring countries; a rising preference for fresh, healthy, safe, environmentally friendly, and socially responsible products; the growing role of services in manufacturing; and increasing demand for skilled resources are also very favorable for NER. Together, these developments can help NER showcase its strengths in agriculture and services, thereby developing value chains in these sectors, which will lead to sustainable, better-paying, job opportunities for the people of NER. In this context, the World Bank, in consultation with stakeholders--government, private sector, and academia--analyzed two cross-cutting constraints that are encountered across all value chains and sectors in NER: connectivity and logistics, and product standards and quality infrastructure. These are discussed in Playing to Strengths: A Policy Framework for Mainstreaming Northeast India (Kathuria, S., and P. Mathur, eds., 2019, World Bank). This volume is a companion piece to that report; it analyzes four value chains--fruits and vegetables, spices, bamboo and related products, and medical tourism--and provides an assessment of how Bangladesh can benefit from NER’s increasing connectivity and growth prospects. The sector studies emphasize the need to reorient the supply base in NER toward serving the changing global demand and puts an explicit focus on women as well as the bottom 40 percent of the workforce. In light of the mutual benefit offered by economic exchange, improvements in connectivity offer a win-win opportunity for NER and Bangladesh.
Opening Up Markets to Neighbors : Gains for Smaller Countries in South Asia
(World Bank, Washington, DC, 2015-01) Kathuria, Sanjay
The South Asia Free Trade Area (SAFTA) came into effect in 2006, but free and unfettered trade is still a work in progress. Drawing from theory and evidence, this note looks at how all countries, especially the smaller ones, can gain from mutual trade liberalization. Consumers, exporters, and producers, the three key players in this debate, all stand to gain from multilateral trade. Consumers enjoy lower prices, more product variety, and better quality goods. Exporters obtain access to much larger markets and sourcing opportunities for key inputs. Producers are incentivized to become more efficient, increase their sizes and scales via access to a bigger market, gain cheaper and higher quality inputs, and receive more foreign direct investment (FDI). As an example of how smaller South Asian nations can reap significant benefits, the US-Mexican asymmetry case study is presented, demonstrating how Mexico rose to become the world's thirteenth largest economy after joining NAFTA. Given that the South Asia region is in the process of making SAFTA effective, nations that hold out from the process could suffer by being "innocent bystanders," which is a welfare loss faced by a country that does not fully participate in a regional agreement being created around it.
How Can South Asia Turn Its Proximity from a Burden to an Advantage?
(World Bank, Washington, DC, 2019-03) Mathur, Priya; Kathuria, Sanjay
Around the world, trade has played a critical role in reducing poverty. Some of the most successful countries in East Asia, Europe, and North America owe much of their success to strong trade relations with their neighbors. However, South Asian countries have yet to reap the benefits of proximity. Intraregional trade accounts for a little more than 5 percent of South Asia’s total trade, compared with 50 percent in East Asia and the Pacific and 22 percent in Sub-Saharan Africa.The World Bank’s recent report, A Glass Half Full: The Promise of Regional Trade in South Asia, clearly illustrates the gaps between current and potential trade in South Asia.The force of gravity—the degree of trade attraction between countries—is also manifest in high levels of informal trade. Informal trade has been estimated at 50 percent of formal trade in South Asia, aggregating assessments of various studies covering the 1993 to 2005 period.The large gaps between actual and potential trade arise because South Asian trade regimes discriminate against each other. This can be shown through an index of trade restrictiveness. Based on global trade data, such an index generates an implicit tariff that measures a country’s tariff and non-tariff barriers on imports. In India, Pakistan, and Sri Lanka, the index is two to nine times higher for imports from South Asia than from the rest of the world.Moreover, although the average burden of non-tariff measures may not appear high, it is high for specific product and market combinations in South Asia. It varies from over 75 percent to over 2,000 percent. Sri Lanka consistently appears on the list of product-market combinations with the highest trade restrictiveness index in the region. Barriers that have held back trade and investment within South Asia include tariffs and para tariffs, real and perceived non-tariff barriers, connectivity costs as manifested in the cost of air travel, and the broader trust deficit.
Strengthening Competitiveness In Bangladesh—Thematic Assessment: A Diagnostic Trade Integration Study
(Washington, DC: World Bank, 2016-07-15) Kathuria, Sanjay; Malouche, Mariem Mezghenni; Kathuria, Sanjay; Malouche, Mariem Mezghenni
This is volume 2 of a three-volume publication on Bangladesh’s trade prospects. Bangladesh’s ambition is to build on its very solid growth and poverty reduction achievements, and accelerate growth to become a middle income country by 2021, and share prosperity more widely amongst its citizens. This includes one of its greatest development challenges: to provide gainful employment to the over 2 million people that will join the labor force each year over the next decade. Moreover, only 54.1 million of its 94 million working age people are employed. Bangladesh needs to use its labor endowment even more intensively to increase growth and, in turn, to absorb the incoming labor. The Diagnostic Trade Integration Study identifies the following actions centered around four pillars to sustain and accelerate export growth: (1) breaking into new markets through a) better trade logistics to reduce delivery lags ; as world markets become more competitive and newer products demand shorter lead times, to generate new sources of competitiveness and thereby enable market diversification; and b) better exploitation of regional trading opportunities in nearby growing and dynamic markets, especially East and South Asia; (2) breaking into new products through a) more neutral and rational trade policy and taxation and bonded warehouse schemes; b) concerted efforts to spur domestic investment and attract foreign direct investment, to contribute to export promotion and diversification, including by easing the energy and land constraints; and c) strategic development and promotion of services trade; (3) improving worker and consumer welfare by a) improving skills and literacy; b) implementing labor and work safety guidelines; and c) making safety nets more effective in dealing with trade shocks; and (4) building a supportive environment, including a) sustaining sound macroeconomic fundamentals; and b) strengthening the institutional capacity for strategic policy making aimed at the objective of international competitiveness to help bring focus and coherence to the government’s reform efforts. This second volume provides in-depth analysis across seven cross-cutting themes that underpin most of the findings of pillars 1 and 2 above.
How Has Regional Integration Taken Place in Other Regions?: Lessons for South Asia
(World Bank, Washington, DC, 2015-04) Shahid, Sohaib; Kathuria, Sanjay; Ferrantino, Michael Joseph
As the momentum for multilateral trade liberalization has slowed, an increasing amount of liberalization is taking place at a regional level. As of April 2015, there are 406 regional trade agreements (RTAs) in force worldwide, more than double the number in force in 2000. These agreements cover over half of international trade. Countries engage in regional cooperation for a variety of reasons. First, it is easier to achieve agreement among a small number of regional partners than it is globally. Second, regional cooperation takes advantage of existing natural tendencies for regional trade that arise from geography and shared culture. This reinforces the regional division of labor already taking place among firms. Global value chains, in which lead firms organize a division of labor for complex products among many countries, often turn out to have a regional focus. Think, for example, of the electronics value chain in East Asia, and the automotive value chains focused on the United States, Germany, and Japan. South Asia itself is a small but growing part of value chains in textiles and apparel with both regional depth and cross-linkages to East Asia. This piece will focus on four aspects of trade liberalization (trade facilitation, non-tariff measures/barriers, intra-regional investment, and energy cooperation) that go beyond traditional preferential tariff reduction to illustrate both the potential of south-south liberalization and some of the particular challenges faced by South Asia. There is widespread agreement that deeper regional engagement in these areas will benefit the people of South Asia.