ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846
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Transacting Environments in Formal and Informal Trading

India-Sri Lanka Trade

The Free Trade Agreement between India and Sri Lanka, though in a positive direction, does not address the issue of transaction costs that emanates from the transacting environment. Analysing the characteristics of formal and informal trading between India and Sri Lanka the study shows that transaction costs in formal trading are higher than for informal trading and suggests that lowering transaction costs in formal trade could enhance trade between the two countries.



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