Regional cooperation increases productivity and efficient allocation of resources. The difference in institutions and other inputs across countries will determine the trade pattern of a country. it is widely held believe that open access institutional structure and improved infrastructure increase the productive capacity of a country that leads to more trade. One important determinant of regional integration is the investment in telecommunication infrastructure. This will not only reduce the transportation cost but also improve the institutional quality of a region. So, investment in telecommunication has direct and indirect impact on trade. This study, explore the role of telecommunication in enhancing the trade within SAARC countries. The study will use the data from 1995-2015 for all member countries of SAARC and use structural equation modelling with confirmatory factor analysis will be used to estimate the factor scores. Then these factor scores are used in data envelopment analysis and regression splines to find the trade efficiency. The study found that in SAARC telecommunication infrastructure has a positive and significant impact on trade and institutional quality. The study estimates that one unit increase in telecommunication infrastructure will lead to 0.98 units increase in trade within SAARC. The study also finds that the investment in telecommunication infrastructure requires a certain level of institutional quality without this the impact will be negative. The study recommends that SAARC should focus on improving telecommunication infrastructure as well as the institutional quality of the region. Supervisor:- Dr. Hafsa Hina