, singapore, thailand, and taiwan. the share of asia - 9 ’ s gdp in purchasing power parity terms has grown from 11. 4 % in 1990 to 20. 6 % in 2005. to put this in perspective, this exceeds the eu ’ s ppp share of world gdp of 18. 8 %, japan ’ s share of 6. 7 %, and is very close to the united states 20. 7 % share of world gdp in 2005. but i am not here today to overwhelm you with facts and figures! today i would like to discuss one of the most important drivers of this phenomenal growth – and that is, international trade. i believe that asia - 9 ’ s experience of growth, or more specifically, intra - regional trade and production, can provide an interesting case study for our south asian counterparts. the emergence of the asia - 9 economies to bring this perspective even closer to home to this audience, let us look at these developments from india ’ s perspective. traditionally, india ’ s trading partners have been the g3 countries, with the us, the eu and japan accounting for 52 % of india ’ s total trade with the world in 1990. at that time, india ’ s trade with asia - 9 accounted for only 8. 3 % of india ’ s total trade. fifteen years later, the structure has changed remarkably. the share of trade with the g3 countries, in terms of india ’ s total trade, has fallen to 33. 9 %. during the same period of time, india ’ s trade with asia - 9 has risen from 8. 3 % to 23. 3 % - an almost three - fold rise. from the perspective of asia - 9 themselves, intra - regional trade among themselves has risen from 29. 1 % of their total trade in 1990 to 41. 4 % in 2005. more striking, the share of intra - regional trade among the asia - 9 economies has outgrown the share of their trade with the g3 countries over the same period, which has in fact fallen from 52. 6 % to 39. 2 %. in terms of growth, trade among asia - 9 economies has grown at an average 23 % in the past 3 years, exceeding the average 17 % growth in trade with g3 countries. what message can we draw from these developments? i think that for the asia - 9 economies, increased trade - linkages and cross - border investment have resulted in a “ symbiotic ”

relationship, with china as the driver of growth for the rest of asia, and vice - versa. together, this relationship has helped raise the profile of asia - 9 as an important pillar for regional and international trade. factors underlying asia - 9 ’ s growth in trade what have been the driving forces behind this synergy in the evolution of trade among the asia - 9 economies? when one speaks of the remarkable growth in asia, the general perception is that growth has been dominated by china. while it is true that growth has been driven by china, the traditionally strong trade and investment ties between the remaining asia - 8 have been just as important in allowing the high rates of growth to be sustained in the region. in terms of intra - regional trade among the asia - 9 economies in 2005, 13 % of trade flows are with china, while 28. 4 % of trade goes on among the other 8 economies. why has this intra - regional trade grown so substantially? one explanation is that east asia has adopted an outward oriented policy of internationalization of production process which has allowed the benefits to be derived from the linkages and alliances among the players in the region, both at firm level and at the level of the macro economy. with modern production processes broken down to components and parts that could be regrouped at the final assembly, east asians have availed themselves of this phenomenon by capitalizing on the “ benefits ” from the international division of labour and production in the areas where they have the greatest comparative advantage. this has in turn brought about the lowest and most efficient production processes available on an international scale, while at the same time encouraging specialization and boosting productivity growth in individual economies. this “ internationalization ” of the production process has now been replicated many times over. countries move up the product ladder towards more sophisticated manufactured products, and parts of the production process are then relocated from traditional producers such as from japan, korea, and taiwan to south east asian countries with lower production costs. this has led not only to a rise in the value of trade in the region, but also in a shift of the structure of trade and inter - linkages in production in the region. against this background, the success of any enterprise in the region, going forward, must involve production networks and supply chains based not only on one single national economy, but also across borders. this can be witnessed today in the case of manufactured goods, such as automobile production, electronics or textile and garments. in each case,