What is The Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation

The Bay of Bengal Initiative for Multi-Sectoral Technical and Economic Cooperation (BIMSTEC) is one of the solutions to converge the economic interests of India's Look East Policy and Thailand's Look West Policy. Its objective is to integrate the regions on both sides of the Bay of Bengal. The development of BIMSTEC countries is indispensable for the forward march of Asia as a whole. This chapter analyzes the India-BIMSTEC trade activities after the establishment of BIMSTEC bloc. Gravity model and Auto-Regressive Integrated Moving Average (ARIMA) are used. The model estimates the sets of regression equations to measure the effects of regional trade agreements using ordinary least squares with nation dummies to capture country-specific fixed effects. The study reveals that all coefficients of regional dummy variables are mostly positive and significant, indicating the agreements that tend to enhance more trade than bilateral trade agreements. The authors state that based on India's trade with the BIMSTEC region, there exists a scope for intraregional trade in the future.