Evaluation of the Possibility of Establishing Regional Commercial Ties Between Iran And Central Asian Countries

Regarding Islamic Conferece Organization's aim to establish a Common Market among Islamic countries and expedite the establishment of Regional Commercial ties, various islamiic countries have been divided into five groups according to their regions. In the meanwhile this research seeks to investigate the establishment of regional commercial ties between Iran and Central Asian Countries due to common economic interests. The procedure of this research is based on gravity model and panel data considering 7 variables including Population, Geographical distance, degree of Openness, GDP, amount of bilateral commerce, Per capita income and Linder index for panel data of Iran and other five Central Asian Countries for the years 1998-2006. Results showed commercial potential to establishment of regional commercial ties with Central Asian Countries. It is enough to obtain the agreementof two or three countries to manage opportunities properly within signed contracts to attract other countries of region for establishment of regional commercial ties. Turkmenistan and Tajikistan and Uzbekistan are suggested to achive this purpose.