Fighting Irrelevance: The Role of Regional Trade Agreements in International Production Networks in Asia

Abstract

This chapter contains the sectoral case study on the Indian automotive sector. The automotive industry in India has thus undergone a transition, from comprising a few auto manufacturers, virtually no auto components makers and only low-quality auto ancillary producers to the league of global auto manufacturers, competitive component manufacturers and emerging ancillary producers. Several studies have revealed that previously the Indian automotive industry was not competitive enough for the global market due to inferior quality, lower labour productivity and high cost of raw materials in India (e.g., Pradosh and others, 2006). However, as in other markets, globalization has made the automotive market very competitive and brought profit margins to a very low level.trade liberalization, international production networks, regional trade agreements, value chain, Asia, automotive, East Asia, India