SINGAPORE-INDIA TRADE : TRENDS AND ISSUES

Abstract

With the slowing down of the world economic growth, and increasing protectionism in the international trade environment, Singapore can no longer completely rely on the same foreign markets as this would render her vulnerable to fluctations in growth performance of the major trading partners namely, the United States, Japan and the European Community. This implies that she has to find new outlets for her exports.

India, in her attempt to further industrialise the economy has, since 1985, pursued economic policies, which led to the liberalisation of her trading and investment environment. This change in India's economic topography has highlighted her as another lucrative market for Singapore's diversification. This renewed interest in India is well exemplified in the recent trends in merchandise trade between the two countries. Not only have the value and volume of this trade increased, the commodity composition of this trade has changed. It has shifted from oil-based goods to non­oil commodities and from traditional goods like clothing to non­traditional ones like computers and electronics.

The economic relationship between tne two countries extended well beyond the frontiers of merchandise trade into other aspects of economic cooperation such as joint ventures between Singapore and Indian firms in production activities and in undertaking projects in third countries. This Acadamic Exercise provides an insight to the past trends in Singapore's trade with India and briefly looks at the future.