WORLD TRADE ORGANIZATION (WTO)

INTRODUCTION
The World Trade Organization is the only global international organization dealing with the rules of trade between nations. For beginners, WTO helps in understanding how international trade is regulated, how trade disputes are resolved, and how countries negotiate market access. From an OPSC prelims point of view, WTO is a very important static topic because questions are frequently asked on its origin, objectives, principles, agreements, bodies, and dispute settlement mechanism.

ORIGIN AND BACKGROUND
• Established in 1995
• Came into existence after the Uruguay Round of negotiations (1986–1994)
• Replaced the General Agreement on Tariffs and Trade (GATT), which was formed in 1947
• Created to provide a permanent institutional framework for global trade rules

HEADQUARTERS AND MEMBERSHIP
• Headquarters: Geneva, Switzerland
• Total members: 164 countries
• India is a founding member
• Decisions are generally taken by consensus

OBJECTIVES OF WTO
• Promote free and fair trade
• Reduce trade barriers
• Ensure predictability and transparency in trade
• Raise standards of living and employment
• Ensure sustainable development
• Integrate developing countries into global trade

CORE PRINCIPLES OF WTO (VERY IMPORTANT FOR PRELIMS)
1. Most Favoured Nation (MFN)
• Equal trade treatment to all members
• No discrimination between trading partners

2. National Treatment
• Imported goods treated the same as domestic goods after entry into market

3. Free Trade Through Negotiation
• Progressive reduction of tariffs and non-tariff barriers

4. Predictability
• Binding commitments on tariffs

5. Fair Competition
• Discourages dumping and unfair trade practices

6. Special and Differential Treatment
• Special provisions for developing and least developed countries

MAJOR WTO AGREEMENTS
1. GATT – Trade in goods
2. GATS – Trade in services
3. TRIPS – Trade-Related Aspects of Intellectual Property Rights
4. Agreement on Agriculture
5. Agreement on Subsidies and Countervailing Measures
6. Agreement on Anti-Dumping

INSTITUTIONAL STRUCTURE
• Ministerial Conference – highest decision-making body
• General Council – day-to-day decision making
• Dispute Settlement Body
• Trade Policy Review Body
• Councils for Goods, Services and TRIPS

DISPUTE SETTLEMENT MECHANISM (DSM)
• One of the most important features of WTO
• Provides rule-based mechanism to resolve trade disputes
• Appellate Body hears appeals (currently facing functional issues)

INDIA AND WTO
• India is an active participant in WTO negotiations
• Strong advocate of developing countries’ interests
• Key issues for India include agriculture subsidies, public stockholding and special safeguard mechanism
• India has been involved in multiple WTO dispute cases

CURRENT RELEVANCE
• Crisis in WTO Appellate Body due to appointment blockage
• Ongoing negotiations on fisheries subsidies
• Debates on reform of WTO
• Issues related to e-commerce and digital trade

PRELIMS NOTES AND COMMON CONFUSIONS
• WTO is not a UN agency
• WTO agreements are binding on members
• GATT still exists as part of WTO framework
• Decisions are mostly consensus-based, not voting

---

PDF File:

No PDF attached

---

Subject: International Relation

← Back