Assessing the Impact of Non-Tariff Measures on India’s Export Performance in the European Union: Evidence from Sectoral Trade Data

Abstract

Non-tariff measures (NTMs) have become increasingly important in determining international market access as tariffs have declined and regulatory requirements have expanded. For Indian exporters, the European Union (EU) represents a significant destination market, but access depends not only on prices and tariff preferences but also on compliance with technical regulations, sanitary and phytosanitary requirements, conformity-assessment procedures, product traceability, labelling rules, and sustainability-related standards. This paper develops an empirical framework to assess the impact of NTMs on India’s export performance in the EU using sectoral trade data. It proposes a sector-level panel analysis combining bilateral export values, EU import demand, applied tariffs, and NTM indicators for selected manufacturing and agricultural sectors. The empirical strategy employs a structural gravity framework with product or sector fixed effects and appropriate controls for time-varying economic conditions. It distinguishes between the trade-restricting effects of compliance costs and the potential trade-enhancing effects of standards that improve product quality, information, and consumer confidence. Particular attention is given to pharmaceuticals, textiles and apparel, chemicals, agricultural products, processed foods, and engineering goods. The paper establishes testable hypotheses and outlines robustness checks, including alternative NTM measures, sectoral heterogeneity, and treatment of zero trade flows. Its proposed contribution is to identify which types of regulatory measures are most strongly associated with Indian export performance and to derive policy implications for export readiness, regulatory cooperation, standards infrastructure, and support for small and medium-sized enterprises. Quantitative conclusions are reserved for estimation using the specified trade and regulatory datasets.