Changing bilateral trade between China and India

Bilateral trade between China and India, the world's two most populous countries, have expanded substantially in recent years. Few studies have however focused on the understanding of this trade relationship. This paper attempts to fill the void of the literature. Its objective is to examine and compare international trade in and between the two economies and to draw implications for trade and economic cooperation between China and India in the future. Especially, this paper investigates the major trends of and changes in the bilateral trade between the two countries, and explores issues associated with trade intensity, intra-industry trade and comparative advantages in the two countries. The findings are used to draw policy implications for future trade and economic cooperation between the two Asian developing giants. (C) 2006 Elsevier Inc. All rights reserved.