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wThe general Agreement on Tariff and Trade(GATT), the

predecessor of WTO was born in 1948 as a result of
international desire to liberalize trade.
wIt was a provisional agreement created to handle the
trade side of international economic cooperation, joining
the two ³Bretton
³Bretton Woods´ institutions, the World Bank and
the IMF.
wIndia signatory to GATT 1947 along with 22 other
wEight rounds of negotiations had taken place during 5
decades of its existence.
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w GATT sought substantial reduction in tariff &

other barriers to trade & to eliminate
discriminatory treatment in international
w A section on development added in the
³plurilateral´´ agreements in the
1960s and ³plurilateral
1970s which was achieved through a series of
multilateral negotiations known as ³trade
w Major trade rounds-
rounds- Kennedy trade round,
Tokyo trade round and Uruguay trade round.


w èaising standard of living.

w Full employment and steadily growing
volume of real income and effective
w Developing full use of resources of world.
w Expansion of production and trade.
º  º

Ñon-- discrimination.
w Ñon
w Prohibition of quantitative restrictions.
w Consultation.

w GATT could achieve considerable trade liberalisation with a few
w It established a forum for continuing consultation.
w èeduced tariffs combined with a series of economic recessions in the
1970s and early 1980s, drove governments to devise other forms of
protection for sectors facing increased foreign competition.
w High rates of unemployment and constant factory closures led
governments in Western Europe and Ñorth America to seek bilateral
market--sharing arrangements with competitors and to embark on a
subsidies race to maintain their holds on agricultural trade. Both these
changes undermined GATT¶s credibility and effectiveness.
w For a start, world trade had become far more complex and important than
40 years before: the globalization of the world economy was underway,
trade in services ² not covered by GATT rules ² was of major interest to
more and more countries, and international investment had expanded.
w Trade liberalisation had been confined to goods of interest to developed
countries. Efforts at liberalizing agricultural trade met with little success.
Manufactured products of interest to developing countries (textile,
footwear ,etc.) have been subject ÑTBs.
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w The eighth, the Uruguay èound of 1986 1986--94,

was the last trade round. It led to the WTO and
a new set of agreements.
w It took seven and a half years. 123 countries
took part. It covered almost all trade, from
toothbrushes to pleasure boats, from banking
to telecommunications, from the genes of wild
rice to AIDS treatments. It was the largest trade
negotiation ever.


w èeducing specific trade barriers and

improving market access.
w Strengthening GATT disciplines.
w Liberalisation of trade in services. Uè
went much beyond goods to services
technology, investment and information.
w TèIPs and TèIMs.

w Liberalisation of Trade in Manufactures.
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w Expansion of tariff bindings: To cover 99% of imports.
w - èeduction in tariff rates: From 6.2 to 3.7%.
w - Expansion of duty free access: From 20 to 43% of imports.
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w Liberalisation of Agricultural Trade.

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w Uè was by far the most complex and controversial.
w Inclusion of new areas like TèIPs, TèIMs, services;
attempts to liberalise agricultural trade and elimination
of ÑTBs increased the complexities.
w Tariffication of trade barriers claimed a significant
success of Uè.
w GATT estimated that world trade would increase by
12% if Uè package is completely implemented.
w Value of world export would increase by 10%.
w Initiation of liberalization of trade in
w Modes of international delivery of services
‡ -Cross border supply
‡ -Commercial presence
‡ -Consumption abroad
‡ -Movement of personnel
w GATS includes most favored nation
w Transparency requirements obligation.
w Apply restrictions on international transfers
and payments for current transactions
envisaged under GATS.
w Commitments of member countries under
GATS also include national treatment and
provision of market access.
w Although developing countries have great
potential to benefit from liberalization if
services trade, they have several

w Multilateral Agreement on Trade in
w èecognizes certain investment measures
which can have trade-
trade-restrictive and
distorting effects.
w Ño member shall apply a measure
prohibited by provisions of GATT.
w Some inconsistent measure in annexure¶s
illustrated list include :-
‡ Local contents requirement.
‡ Trade balancing requirement.
‡ Trade in foreign exchange balancing requirements.
‡ Domestic sales requirements.
w Ñotification of all WTO TèIMS and their
phasing out within two, five and seven
w Came into existence on 1st January 1995 and
is the most comprehensive multilateral
agreement on intellectual property.
w Areas of intellectual property covered by it are:-
‡ Copyright and related rights.
‡ Trademarks.
‡ Geographical indications.
‡ Industrial designs.
‡ Patents.
‡ Layout designs of integrated circuits.
‡ Undisclosed information.

w Three main features of Agreement are:-

‡ Standards.
‡ Enforcement.
‡ Dispute settlement.
w WTO came into existence on 1st January 1995 with
the inclusion of Uruguay round Multilateral
Ñegotiations at Marrakesh on 15th April 1994, to:
‡ Transparent, free and rule-based trading system
‡ Provide common institutional framework for
conduct of trade relation among members
‡ Facilitate the implementation, administration and
operation of Multilateral Trade Agreements
èules and Procedures Governing Dispute
Trade Policy èeview Mechanism
Concern on Ñon-trade issues such as Food
Security, environment, health, etc.
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w At the J  


of WTO in
   , in Ñovember 2001, in which 142
members agreed to launch new negotiations.

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‡ Agriculture

‡ Service

‡ Textiles and clothing


‡ Market access for non-

non-agricultural products

‡ Anti

‡ èegional trade agreements

‡ Least development countries

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w Do developing countries suffer in WTO
w Special considerations.
w Agricultural trade liberalization.
w Textile trade liberalization.
w Services trade liberalization.
w Dissimilar effects.
w Unequal participation.
w Implementation issues.
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w Should India quit WTO?

‡ MFÑ status.

‡ Infinitely laborious task of entering into bilateral


‡ India¶s agricultural subsidies and exports.

w India¶s trade gain.

w Compliance measures - India has to
comply with :
‡ TèIPs
‡ Burn Convention & copyright act.
‡ Trade and merchandise act,1958/ Trade Marks
Act, 1999.
‡ Geographical indications (registration and
protection) act.
‡ Protection of plant varieties and farmers¶ rights
‡ Connection on biological diversity (CBD),
December 1993.
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