Do Tax Treaties Matter? Empirical Evidence on India’s Bilateral Trade from an Augmented Gravity Model

Do Tax Treaties Matter? Empirical Evidence on India’s Bilateral Trade from an Augmented Gravity Model | Research Square window.SnipcartSettings = { analytics: { enabled: false } }; (function() { var accessVector = localStorage.getItem('access_vector') || ''; window.dataLayer = window.dataLayer || []; if (accessVector) { window.dataLayer.push({ user: { profile: { profileInfo: { snid: accessVector } } } }); } })(); (function(w,d,s,l,i){w[l]=w[l]||[];w[l].push({'gtm.start':new Date().getTime(),event:'gtm.js'});var f=d.getElementsByTagName(s)[0],j=d.createElement(s),dl=l!='dataLayer'?'&l='+l:'';j.async=true;j.src='https://www.googletagmanager.com/gtm.js?id='+i+dl;f.parentNode.insertBefore(j,f);})(window,document,'script','dataLayer','GTM-K279D39R'); Browse Preprints In Review Journals COVID-19 Preprints AJE Video Bytes Research Tools Research Promotion AJE Professional Editing AJE Rubriq About Preprint Platform In Review Editorial Policies Our Team Advisory Board Help Center Sign In Submit a Preprint Cite Share Download PDF Research Article Do Tax Treaties Matter? Empirical Evidence on India’s Bilateral Trade from an Augmented Gravity Model Firdous Ahmad Hurrah, Khalid Ashraf Chisti This is a preprint; it has not been peer reviewed by a journal. https://doi.org/ 10.21203/rs.3.rs-6729442/v1 This work is licensed under a CC BY 4.0 License Status: Posted Version 1 posted You are reading this latest preprint version Abstract This study investigates the impact of Double Taxation Treaties (DTTs) on India’s bilateral trade using a panel dataset of 22 major investing countries over the period 1990 to 2022. Grounded in the augmented gravity model of trade, the paper incorporates key economic and institutional variables such as GDP, distance, common language, historical ties, and the presence of tax treaties. To ensure robust and reliable estimates, the analysis employs both Ordinary Least Squares (OLS) and Poisson Pseudo Maximum Likelihood (PPML) methods, with the latter addressing issues like heteroscedasticity and zero trade flows. Across all model specifications, the results consistently show that DTTs have a significant positive effect on India’s trade flows, confirming their role in reducing tax-related trade barriers and enhancing economic cooperation. These findings underline the importance of maintaining and updating India's tax treaty network as a strategic tool for global trade integration. The study provides meaningful insights for policymakers aiming to strengthen India's trade framework through effective international tax policy. JEL Classification: F14, F15, F53, H87, C33 Double Taxation Treaties Bilateral Trade Gravity Model PPML OLS India International Tax Policy Economic Integration Full Text Additional Declarations No competing interests reported. Cite Share Download PDF Status: Posted Version 1 posted You are reading this latest preprint version Research Square lets you share your work early, gain feedback from the community, and start making changes to your manuscript prior to peer review in a journal. As a division of Research Square Company, we’re committed to making research communication faster, fairer, and more useful. We do this by developing innovative software and high quality services for the global research community. Our growing team is made up of researchers and industry professionals working together to solve the most critical problems facing scientific publishing. Also discoverable on Platform About Our Team In Review Editorial Policies Advisory Board Help Center Resources Author Services Accessibility API Access RSS feed Manage Cookie Preferences © Research Square 2026 | ISSN 2693-5015 (online) Privacy Policy Terms of Service Do Not Sell My Personal Information {"props":{"pageProps":{"initialData":{"identity":"rs-6729442","acceptedTermsAndConditions":true,"allowDirectSubmit":true,"archivedVersions":[],"articleType":"Research Article","associatedPublications":[],"authors":[{"id":463538093,"identity":"88ae70d7-ab08-47ad-9a34-59e89a435d85","order_by":0,"name":"Firdous Ahmad Hurrah","email":"data:image/png;base64,iVBORw0KGgoAAAANSUhEUgAAAZAAAAAyAQMAAABI0h/eAAAABlBMVEX///8AAABVwtN+AAAACXBIWXMAAA7EAAAOxAGVKw4bAAAA5UlEQVRIiWNgGAWjYDAC5oMNDDxA2v7+4QNASkKGsBa2RIgWhhtsCSAtPERoASqEaOExAFGEtfC3Mbd9eFNx2J5xds/nVzdqLHgY2A8f3YBPi8QxxuaZc84cTmyWObvNOucY0GE8aWk38Fpzv7GZmbftcAIbQ+424xw2oBYJHjO8WuSBtoC02PMw5DwzzvlHhBYDqBbGGRI5zI9z24jQYgjUwjjnTHriBp5jZsy5fRI8bIT8IneM/THDmwprewP25sefc77VyfGzHz6G3/tIgE0CTBKrHASYP5CiehSMglEwCkYOAABkcUZ8YxBm7wAAAABJRU5ErkJggg==","orcid":"","institution":"University of Kashmir","correspondingAuthor":true,"prefix":"","firstName":"Firdous","middleName":"Ahmad","lastName":"Hurrah","suffix":""},{"id":463538094,"identity":"31dfbcaf-7b58-426d-ba80-c98319dd56ff","order_by":1,"name":"Khalid Ashraf Chisti","email":"","orcid":"","institution":"University of Kashmir","correspondingAuthor":false,"prefix":"","firstName":"Khalid","middleName":"Ashraf","lastName":"Chisti","suffix":""}],"badges":[],"createdAt":"2025-05-23 05:23:10","currentVersionCode":1,"declarations":"","doi":"10.21203/rs.3.rs-6729442/v1","doiUrl":"https://doi.org/10.21203/rs.3.rs-6729442/v1","draftVersion":[],"editorialEvents":[],"editorialNote":"","failedWorkflow":false,"files":[{"id":84409239,"identity":"c6ff41c7-578c-4df8-a1af-d07c81ee3e55","added_by":"auto","created_at":"2025-06-11 15:02:10","extension":"pdf","order_by":1,"title":"","display":"","copyAsset":false,"role":"manuscript-pdf","size":397936,"visible":true,"origin":"","legend":"","description":"","filename":"tradepaperthesis.pdf","url":"https://assets-eu.researchsquare.com/files/rs-6729442/v1_covered_fdf82245-7c0e-43a5-8970-2764293f80a7.pdf"}],"financialInterests":"No competing interests reported.","formattedTitle":"Do Tax Treaties Matter? Empirical Evidence on India’s Bilateral Trade from an Augmented Gravity Model","fulltext":[],"fulltextSource":"","fullText":"","funders":[],"hasAdminPriorityOnWorkflow":false,"hasManuscriptDocX":false,"hasOptedInToPreprint":true,"hasPassedJournalQc":"","hasAnyPriority":true,"hideJournal":true,"highlight":"","institution":"","isAcceptedByJournal":false,"isAuthorSuppliedPdf":true,"isDeskRejected":"","isHiddenFromSearch":false,"isInQc":false,"isInWorkflow":false,"isPdf":true,"isPdfUpToDate":true,"isWithdrawnOrRetracted":false,"journal":{"display":true,"email":"[email protected]","identity":"researchsquare","isNatureJournal":false,"hasQc":true,"allowDirectSubmit":true,"externalIdentity":"","sideBox":"","snPcode":"","submissionUrl":"/submission","title":"Research Square","twitterHandle":"researchsquare","acdcEnabled":true,"dfaEnabled":false,"editorialSystem":"","reportingPortfolio":"","inReviewEnabled":false,"inReviewRevisionsEnabled":true},"keywords":"Double Taxation Treaties, Bilateral Trade, Gravity Model, PPML, OLS, India, International Tax Policy, Economic Integration","lastPublishedDoi":"10.21203/rs.3.rs-6729442/v1","lastPublishedDoiUrl":"https://doi.org/10.21203/rs.3.rs-6729442/v1","license":{"name":"CC BY 4.0","url":"https://creativecommons.org/licenses/by/4.0/"},"manuscriptAbstract":"\u003cp\u003eThis study investigates the impact of Double Taxation Treaties (DTTs) on India’s bilateral trade using a panel dataset of 22 major investing countries over the period 1990 to 2022. 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Empirical Evidence on India’s Bilateral Trade from an Augmented Gravity Model","msid":"","msnumber":"","nonDraftVersions":[{"code":1,"date":"2025-06-02 10:43:11","doi":"10.21203/rs.3.rs-6729442/v1","editorialEvents":[{"type":"communityComments","content":0}],"status":"published","journal":{"display":true,"email":"[email protected]","identity":"researchsquare","isNatureJournal":false,"hasQc":true,"allowDirectSubmit":true,"externalIdentity":"","sideBox":"","snPcode":"","submissionUrl":"/submission","title":"Research Square","twitterHandle":"researchsquare","acdcEnabled":true,"dfaEnabled":false,"editorialSystem":"","reportingPortfolio":"","inReviewEnabled":false,"inReviewRevisionsEnabled":true}}],"origin":"","ownerIdentity":"4c46c7ab-3f98-48b5-ad6a-b0e5963ae4ec","owner":[],"postedDate":"June 2nd, 2025","published":true,"recentEditorialEvents":[],"rejectedJournal":[],"revision":"","amendment":"","status":"posted","subjectAreas":[],"tags":[],"updatedAt":"2025-06-11T14:54:00+00:00","versionOfRecord":[],"versionCreatedAt":"2025-06-02 10:43:11","video":"","vorDoi":"","vorDoiUrl":"","workflowStages":[]},"version":"v1","identity":"rs-6729442","journalConfig":"researchsquare"},"__N_SSP":true},"page":"/article/[identity]/[[...version]]","query":{"redirect":"/article/rs-6729442","identity":"rs-6729442","version":["v1"]},"buildId":"XKTyCvWXoU3ODBz1xrDgd","isFallback":false,"isExperimentalCompile":false,"dynamicIds":[84888],"gssp":true,"scriptLoader":[]}