When the Uruguay round of GATT talks was in progress during early 1990s, Indian

economy was ailing and was totally out of track. Under this compelling situation,
India adopted new economic reforms (NERS) in 1991 based on Rao-Manmohan
Model as a crisis driven strategy. Macro Economic Stabilization (MES) which covered
reforms in monetary policy, fiscal policy and external sector was brought to provide
immediate relief to ailing economy. But, structural reforms, also called
SAP(Structural Adjustment Programmes), was meant for long term reform process
which covered components of industrial policy reform, PSU reform, financial sector
reform and trade & capital flow reforms. Then crisis-driven reforms has now reached
to consensus driven under second generation of our reform policies. These changes
in Indian economy based on LPG gave rise to a new market economy that brought
growth and development in India. In this context, the emergence of WTO as
multilateral trade body to make trade friendly environment at the global level and
Indian attachment to this body could be understood.

India one of the founder member of WTO, had its own expectations as well as
reservations about the new economic order. While it unleashed great opportunities
for agriculture and textiles sectors by improving their access to developed countries
(as provided by AoA-Agreement on Agriculture and phasing out of MFA- Multi Fiber
Agreement), it has some grey areas in the form of provisions for patent regime and
services sector. As the events gradually unfolded, India, like other developing
countries recognized that the rules of the game were not favorable to them and
they must play on active role within the permissible limits to minimize the damage.
In the last decade, our economic agenda and the policies to be pursued have been
largely shaped by the WTO commitments.

India adopted the process of globalization and WTO rulings as a facet of

structural reforms. It brought devaluation in currency in 1991 and also adopted
convertibility system in Indian rupees in different stages. Trade and current account
have been made fully convertibility regime, though cautious and as a long term
objective. Various steps have been taken towards import liberalization in India, for
example, de-licensing, de-canalisation &expansion of OGL (open general license),
removing quantitative restriction, lowering peak custom rate, etc,. India has also
adopted a very liberal policy towards foreign capital to attract direct foreign
investment and portfolio investment. Insurance and print media have been opened
for private competition. India has made following changes in the economy as
mandated by WTO.

• Quantitative restrictions have been completely phased out in 2000-01 and

only the tariff structure remains which itself has been lowered considerably,
with 67% of the tariff lines being bound.

• Patent law has been reformed with amendment of Patent act (2006). It
provides for product patent in pharmaceutical and farm products.

• Under the TRIMS agreement, restrictions on entry of foreign investment and

conditions upon various aspects have been removed and relaxed. Except a
 few sectors, FDI is being allowed upto 100% though automatic route and
Indian companies are also free to invest abroad.

• Under the GATS(General Agreement on Trade in Services), India has made

commitment in 33 activities where foreign service providers are allowed to
enter keeping in view national interests.

• India’s legislation on Custom Valuation rules, 1998 has been amended to

bring it in conformity with the provisions of WTO agreements on
implementation of article VII of GATT 1994 and the Customs Valuation
Agreement.

A survey of last 15 years since adoption of new economic reforms and

especially after joining WTO, it is now clear that we have done well and still a lot of
scope remained for further development. The process of globalization and the
provision of WTO have had, no doubt, some important positive implications. Under
this process, a platform has been created for different types of multilateral
agreements. Multilateral regulation and discipline have been established & imposed
and up to certain extent, trade friendly environment has been created. Disputes are
being solved & managed and trading activities are getting protection. India is also
getting the benefits of this emerging trade friendly environment.

Indian exports, especially exports of agricultural good, have been increased.

The Doha development Agenda, though passing through hard times; is built on the
long term objective of the AOA to establish a fair and a market oriented trading
system. India could be highly advantaged with DDA. During the ongoing
negotiations, India and other developing countries have sought a special safeguard
mechanism (SSM) for addressing situations of import surges or swings in
international prices of agricultural products.

Other measures concerning developing countries in the WTO agreements include:

• Extra time for developing countries to fulfill their commitments (in many of
the WTO agreements)
• Provisions designed to increase developing countries’ trading opportunities
through greater market access (e.g. in textiles, services, technical barriers to
trade)
• Provisions requiring WTO members to safeguard the interests of developing
countries when adopting some domestic or international measures (e.g. in
anti-dumping, safeguards, technical barriers to trade)
• Provisions for various means of helping developing countries (e.g. to deal
with commitments on animal and plant health standards, technical standards,
and in strengthening their domestic telecommunications sectors).

The WTO agreements, which were the outcome of the 1986–94 Uruguay Round of
trade negotiations, provide numerous opportunities for developing countries to
make gains. Further liberalization through the Doha Agenda negotiations aims to
improve the opportunities. Among the gains are export opportunities. They include:
• Fundamental reforms in agricultural trade
• phasing out quotas on developing countries’ exports of textiles and clothing
• Reductions in customs duties on industrial products
• expanding the number of products whose customs duty rates are “bound”
under the WTO, making the rates difficult to raise
• phasing out bilateral agreements to restrict traded quantities of certain goods
—these “grey area” measures (the so-called voluntary export restraints) are
not really recognized under GATT-WTO.