By:

Sarath J Nair

PGDM-IB

About WTO

World Trade Organization

Location :- Geneva, Switzerland Established: 1 January 1995 Created by : Uruguay Round negotiations (1986-94) Membership :153 countries 2007 Secretariat Staff : 625

Head : Director-General, Pascal Lamy

Objectives

The WTO reiterates the objectives of GATT . Raising standard of living and income . Introduce sustainable development. Taking positive steps to ensure that developing countries.

Key Subjects in WTO

KEY SUBJECTS IN WTO

Agriculture

Health & safety measures

Helping least developed and food importing countries

Textile and Clothing

 TRIPS ( Trade Related Aspects Of Intellectual Property Rights) TRIMS ( Trade Related Investment Measures) GATS ( The General Agreement On Trade In Services)

WTO & IMPLICATIONS FOR INDIAN ECONOMY

One of the most dramatic events that have taken place in later part of 20th century was culmination of GATT 1947 into WTO, which came into force on 1st January 1995.This WTO has set expectations high in various member countries regarding spurt in world trade where India has insignificant share in the pie-Only 0.75% at the most. Even in IT exports the share of Indian exporters is just peanuts in view of overall world market.

 Agriculture seems to be bone of contention for all types of countries where France, Japan and some countries are just not willing to budge downwards in matter of domestic support and export assistance to farmers and exporters of agriculture produce.

Dismantling of MFA (Multi Fiber Agreement) and its likely impact on countries like India

PROBLEMS FACING INDIA IN WTO & ITS IMPLEMENTATION

Predominance of developed nations in negotiations extracting more benefits from developing and least developed countries Resource and skill limitations of smaller countries to understand and negotiate under rules of various agreements under WTO Incompatibility of developed and developing countries resource sizes thereby causing distortions in implementing various decisions Non-tariff barriers being created by developed nations.

WHAT INDIA SHOULD DO?

The most important things for India to address are

speed up internal reforms in building up worldclass infrastructure like roads, ports and electricity supply. India's ranking in recent Global Competitiveness report is not very encouraging due to infrastructure problems, poor governance, poor legal system and poor market access provided by India.

 Our tariffs are still high compared to Developed countries and there will be pressure to reduce them further and faster. India has solid strength, at least for mid term (5-7 years) in services sector primarily in IT sector. India would do well to reorganize its Protective Agricultural policy in name of rural poverty and Food security and try to capitalize on globalization of agriculture markets. The petroleum sector has to be boosted to tap crude oil and gas resources within Indian boundaries and entering into multinational contracts to source oil reserves.

 India must improve legal and administrative infrastructure, improve trade facilitation through cutting down bureaucracy and delays and further ease its financial markets. India has to downsize non-plan expenditure in Subsidies and Government salaries and perquisites like pensions and administrative expenditures. Corruption will also have to be checked by bringing in fast remedial public grievance system, legal system and information dissemination by using egovernance.

BENEFITS FROM WTO

The system helps promote peace

Disputes are handled constructively

Rules make life easier for all Freer trade cuts the costs of living

It provides more choice of products and qualities

Trade raises incomes Trade stimulates economic growth The basic principles make life more efficient Governments are shielded from lobbying The system encourages good government
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Case study Unfair Protection or Valid Defense

INTRODUCTION The case study talks basically about the dumping of foreign goods countries and how its affecting the host countries, and what has WTO done and how its policies are affecting the developing countries and developed countries. How the developed countries are utilizing the developing countries. The case talks about Mexico and various other countries who are implementing various regulations to prevent the domestic market.

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 Unfair Protection or Valid Defense

PROBLEM IN THE CASE The case talks about: Dumping of goods in foreign market? Why is dumping on rise in the first place? Has dumping affected the local traders? The Pros and Cons Of Antidumping tariffs?

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Thank You