WTO

1. ETHIRAJ COLLEGE FOR WOMEN (Autonomous)
Chennai – 600 008
Prepared by
Dr.S.Sudha M.A.,M.Phil.,Ph.D
Department of Business Economics
Topic: WTO

2. Founded: Jan 01, 1995
Headquarters: Geneva, Switzerland
Centre William Rappard, Switzerland
Subsidiary International Trade Centre.
MEMBER COUNTRIES:164

3. Pascal Lamy, a former director general of the
WTO and a former EU trade commissioner.
Roberto Azevedo, Peter Sutherland also a
former director general of WTO.
The Director-General of the World Trade
Organization is responsible for supervising the
administrative functions of the World Trade
Organization (WTO).

4. EVOLUTION OF WTO

5. ❑ It officially commenced operations on 1 January 1995,
pursuant to the 1994 Marrakesh Agreement, thus
replacing the General Agreement on Tariffs and Trade
(GATT) that had been established in 1948.
❑ The World Trade Organization (WTO) Ministerial
Conference, which is attended by trade ministers and
other senior officials from the organization’s 164
members, is the highest decision-making body of the WTO.
Under the Marrakesh Agreement establishing the WTO,
the Ministerial Conference is to meet at least once every
two years.

10. INTRODUCTION TO WORLD
TRADE ORGANISATION
- BY
SHANMUGAPRIYA

11. ⮚ The World Trade organization (WTO) is the only
global international organization dealing with the
rules of trade between countries
⮚ It is an association of 164 member countries of the
193 countries in the world today
⮚ WTO was established on 1st January 1995 and it
replaced the 1947 General Agreement on Tariffs
and trade (GATT)
⮚ It was Headquartered in Geneva, Switzerland
WHAT IS WTO?

12. ⮚ It is an Organization for trade Opening
⮚ It is a forum for governments to negotiate trade
agreements
⮚ It is a place for governments to settle trade
disputes
⮚ It operates a system of trade rules
⮚ WTO is a place where member governments try to
sort out the trade problem they face with each
other
WHO WE ARE?

13. ⮚ The goal is to help producers of Goods and
Services exporters and importers conduct their
business
⮚WTO is run by its member governments
⮚ All major decisions are made by the membership
as a whole, either by ministers (who usually meet
at least once every two year) or by their
ambassadors or delegates (who meet regularly at
Geneva)
WHAT WE DO?

14. ⮚ The WTO agreements are lengthy and complex
because they are legal texts covering a wide range
of activities
⮚ But a number of simple fundamental principles run
throughout all of these documents.
⮚ These principles are the foundation of the
multilateral trading system
WHAT WE STAND FOR?

15. ⮚ The World Trade Organization -The WTO - is the
international Organization whose Primary purpose
is to open trade for the benefits of all.
⮚ From GATT to WTO, Trade has played an
important role in supporting economic development
and promoting peaceful relations among nations.
OVERVIEW

16. Objectives and Features Of
WTO
-R.M.Sai Niveda

17. Objectives Of WTO
• 1. To improve the standard of living of people in the member countries.
• 2. To ensure full employment and broad increase in effective demand.
• 3. To enlarge production and trade of goods.
• 4. To increase the trade of services.
• 5. To ensure optimum utilization of world resources.
• 6. To protect the environment.
• 7. To accept the concept of sustainable development.

18. Features of WTO
• Non-Discrimination
• Free Trade
• Stability in the trading system
• Promotion of fair competition
• Special concern for developing countries
• Market access commitment
• Decision at ministerial leveled Meeting
• Wider range of issues
• Multilateral trading system

19. WORLD TRADE
ORGANISATION

20. FUNCTIONS OF WTO
20

21. •Promoting an environment
that is encouraging to its
member countries to come
forward to WTO in
mitigating their grievances.
Laying down a commonly
accepted code of conduct.
21

22. •Dispute settlement body.
•Holding consultations
with IMF and IBRD and its
affiliated agencies so as
to bring better
understanding and
cooperation in global
economic policy making.
22

23. •Ensuring that all the rules
and regulations are followed.
Supervising on a regular
basis the operations of the
revised Agreements and
Ministerial declarations
relating to goods , services
and Trade related
Intellectual property rights
( TRIPS ).
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24. ACHIEVEMENTS :
❑Greater market orientation
has become the general rule.
❑Use of restrictive measures
for BOP problems has
declined markedly.
❑ Services trade has been
brought into the multilateral
system and many countries,
as in goods, are opening their
markets for trade and
investment either unilaterally
or through regional or
multilateral negotiations.
24

25. ❑Tariff-based protection has
become the norm rather than
the exception.
❑ Many UDCs have undertaken
trade and exchange activities
which have improved the
efficiency of resource use,
opened up new investment
opportunities, and, thus,
promoted economic growth.
❑The trade policy review
mechanism has created a
process of continuous
monitoring of trade policy
developments.
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26. THANK YOU!

27. ECONOMICS SEMINAR

28. Principles of WTO

29. TRADE WITHOUT DISCRIMINATION
Under the WTO agreements, countries cannot normally
discriminate between their trading partners. Grant
someone a special favour (such as a lower customs duty
rate for one of their products) and you have to do the
same for all other WTO members.

30. NATIONAL TREATMENT: Treating foreigners
and locals equally
Imported and locally-produced goods should be treated
equally — at least after the foreign goods have entered
the market. The same should apply to foreign and
domestic services, and to foreign and local trademarks,
copyrights and patents.

31. FREE TRADE: Gradually through
negotiations
Lowering trade barriers is one of the most obvious means
of encouraging trade. The barriers concerned include
customs duties (or tariffs) and measures such as import
bans or quotas that restrict quantities selectively. From
time to time other issues such as red tape and exchange
rate policies have also been discussed.

32. PREDICTABILITY: Through binding and
transparency
Sometimes, promising not to raise a trade barrier can be
as important as lowering one, because the promise gives
businesses a clearer view of their future opportunities.
With stability and predictability, investment is
encouraged, jobs are created and consumers can fully
enjoy the benefits of competition — choice and lower
prices. The multilateral trading system is an attempt by
governments to make the business environment stable
and predictable.

33. PROMOTING FAIR COMPETITION
The WTO is sometimes described as a “free trade”
institution, but that is not entirely accurate. The system
does allow tariffs and, in limited circumstances, other
forms of protection. More accurately, it is a system of
rules dedicated to open, fair and undistorted competition.

34. ENCOURAGING DEVELOPMENT AND
ECONOMIC REFORM
The WTO system contributes to development. On the
other hand, developing countries need flexibility in the
time they take to implement the system’s agreements.
And the agreements themselves inherit the earlier
provisions of GATT that allow for special assistance and
trade concessions for developing countries.

35. WTO IN BRIEF
In brief, the World Trade Organization (WTO) is the only
international In brief, the World Trade Organization (WTO) is the
only international organization dealing with the global rules of
trade. Its main function is to ensure that trade flows as smoothly,
predictably and freely as possible. In brief, the World Trade
Organization (WTO) is the only international organization dealing
with the global rules of trade. Its main function is to ensure that
trade flows as smoothly, predictably and freely as possible. ws as
smoothly, predictably and freely as possible. In brief, the World
Trade Organization (WTO) is the only international organization
dealing with the global rules of trade. Its main function is to
ensure that trade flows as smoothly, predictably and freely as
possible.

36. INDIA AND WTO
BY P NIRUPAMA
B.COM HONOURS, IIND YEAR

37. INTRODUCTION
• India has been a member of the WTO since January 1995 and also
had been a member of the WTO’s forerunner General Agreement
on Tariffs and Trade (GATT) since July 1948. As a developing
country, India has played a significant role in the proceedings of the
WTO, especially in voicing its own concerns and also of the entire
developing world.
• In the Doha WTO conference that took place in 2001, India emerged
as the most outspoken of advocates for the developing bloc. The
meeting was declared a success since the delegates of 142 countries
agreed to a new round of trade talks, including topics such as
environment, competition and investment.

38. ▪ Reduction of Tariff and Non-Tariff Barriers:
The agreement proposes an overall reduction of tariffs on manufactured products
and the phasing out of the quantitative restrictions over a period of time. The
important implication is that the firms that have a competitive advantage would be
able to survive in the long run.
▪ Trade-Related Investment Measures (TRIMS):
This agreement forbids the host country to discriminate against investments from
abroad vis-a-vis domestic investment i.e. agreement requires investment to be freely
allowed by nations.
IMPLICATIONS ON INDIAN ECONOMY

39. ▪ Trade-Related Intellectual Property Rights (TRIPS)
Intellectual property rights seek to protect and provide legal recognition to the
creator of the intangible illegal use of his creation. It includes patents,
copyrights, geographical indications, trademarks, industrial circuits, designs and
trade secrets. Since the law governing these aspects vary vastly across countries,
the agreement stipulates a basic homogeneity of the law so that no infringement
of rights occurred. This required some changes in the domestic laws of countries
including India. As a result, India amended the Copyright Act, the Patents Act,
and the Trade and Merchandise Act. The pharmaceutical and biotechnology
industries are expected to be hit the hardest.

40. ▪ Agreement on Agriculture (AOA)
This agreement deals with giving market access, reducing export
subsidies and government subsidies on agricultural products. Read
about the Agreement on Agriculture in detail in the link.
▪ Agreement on Sanitary and Phyto-sanitary measures (SPM)
This deals with restricting exports of any country that do not comply
with the international standards of germs/bacteria, etc. This is
particularly related to industries such as marine food, food processing
and other packed food.

41. LATEST DEVELOPMENTS:
There are 4 important recent developments related to India and the World Trade
Organisation (WTO). These 4 are listed below
▪ Ban of Chinese Mobile Apps
▪ Issues related to the Peace Clause
▪ Information and Communication Technology (ICT) Tariff Case
▪ Fisheries Subsidies

42. Ban on Chinese Mobile Apps – China Claims Violation of WTO Rules
After India banned 59 mobile apps of China, they have claimed that India has
violated World Trade Organization (WTO) rules. Even if China complains,
WTO may most likely favour Indian decision due to the following reasons.
▪ There is no bilateral agreement between India and China related to
Smartphone apps.
▪ As per the rules of the World Trade Organisation (WTO), a country can take
action against companies if it is a threat to the national security and
sovereignty of the nation.
▪ China has blocked many global giants from entering its market on various
pretexts.

43. Background and Issues related to the Peace Clause
▪ Recently there was an issue concerned with the invoking of the Peace
Clause by India at the World Trade Organisation (WTO). The below-
given questions and answers will give a comprehensive understanding
of the issue faced by India at the World Trade Organization (WTO).
What is a Peace Clause?
▪ High subsidies are seen to be distorting global trade. The peace
clause protects a developing country’s food procurement
programmes against action from WTO members in case subsidy
ceilings are breached.

44. Why did India invoke the Peace Clause at the World Trade Organisation
(WTO)?
In the month of April 2020, India informed the World Trade Organisation
(WTO) that the value of India’s rice production was $ 43.67 billion in 2018-19
and India had given subsidies worth $ 5 billion.
What is the issue related to India invoking the Peace Clause?
India was the first country to invoke the peace clause for breaching the subsidy
limit for rice for the marketing year 2018-19. The limit is pegged at 10% of the
value of food production (called de minimis) in the case of India and other
developing countries.

45. Which Countries questioned India on invoking the World Trade Organisation
(WTO) Peace Clause?
European Union (E.U.), United States of America (USA), Japan, Canada, Brazil
and Paraguay have questioned India for invoking the World Trade Organization
(WTO) peace clause for exceeding the ceiling on the support it can offer its
farmers for rice. The European Union E.U has asked India for all the
information on the products covered by the public stockholding programme to
assure that only rice support exceeded the limits.

46. What were the reasons given by India, in support of its breaching the subsidy
limits and invoking the peace clause?
▪ Rice stocks sold in the domestic market were not allowed for exports thus
preventing the risk of distorting the global market.
▪ An adequate buffer stock of food grains helps deal with fluctuations in
production and meet unforeseen exigencies and natural calamities.
What is the next course of action for India?
▪ India has to hold consultations with other WTO members in line with the Bali
ministerial decision of 2013 on public stockholding for food security purposes.

47. ARGUMENTS FOR JOINING WTO
▪ Ours is one of the few developing countries which has succeeded in implementing
liberalisation programs.
▪ Real importance of WTO to India lies in the role that a dynamic export industry
can play in the country’s development. India outperformes both in terms of job
creation, skill development and technological evolution.
▪ By being a member of WTO India can benefit from International Trade centre
jointly operated by the WTO and United Nations.

48. ▪ Another advantage is that India previously had to entre into a lot of bilateral
trade agreements with many countries. By becoming a member of WTO India
was saved from this thereby enabling it to have trade relations with all
countries.
▪ WTO provides for multilateral set of rules which are beneficial to many
countries like ours. Such rules provide greater protection against bilateral
pressures or against trade restrictions.

49. ARGUEMETS AGAINST MEMBERSHIP
▪ The claim that the world trade would expand substantially and that India’s exports
will expand considerably is not acceptable to many. This is because of the trade
barriers that are still existing among countries.
▪ India being a developing country is difficult for it to adopt the measures of WTO
to a greater extent because ETO favours more of the developed nations.
▪ It can have a serious impact on the agricultural sector.
▪ Many laws are unfavourable to India.

50. CURRENT AFFAIRS OF WTO
-PADMAPRIYA R

51. WTO SEEKS FISH, COVID-19 VACCINE DEALS AS
UKRAINE WAR IGNITES TRADE TENSIONS
BACKGROUND
GLOBAL TRADE DISCORD, COVID-19 AND THE CRIPPLING OF ITS DISPUTE SETTLEMENT MECHANISM
HAD ALREADY WEAKENED THE GENEVA-BASED BODY, WHICH WAS TWICE FORCED TO CANCEL THE
MINISTERIAL CONFERENCE DUE TO THE PANDEMIC.
THE NORMALLY BIENNIAL MEETING, LAST HELD OVER FOUR YEARS AGO, WILL NOW TAKE PLACE
AFTER RUSSIA'S INVASION OF UKRAINE TRIGGERED COMMODITY PRICE HIKES AND FOOD EXPORT
BANS AND CHINA'S ZERO-COVID POLICY EXACERBATES WORLDWIDE SUPPLY CHAIN DIFFICULTIES.

52. 1.Developing countries have sought since 2020 a waiver of intellectual property (IP) rights for vaccines and
other COVID-19 treatments.
It is not yet clear if a vaccine compromise forged by India, South Africa, the EU and the United States will
transform into a full agreement.
2.At the same time, members are negotiating a deal to end subsidies for fishing fleets, a potential
landmark deal to reverse a dramatic decline in fish stocks.
3.One unresolved issues is the transition period for developing countries. Many say this should be five to
seven years, but some suggest as much as 25 years.

53. 60 WTO NATIONS BACK NEW METHOD ON
FOOD SUBSIDIES
• BACKDROP
The G33, African Group and the ACP (African, Caribbean and Pacific) group on Tuesday
submitted a joint proposal to the WTO in which they said a permanent solution for public
stockholding should account for inflation and also be based on a recent reference price
instead of an old one based on 1986-88 prices.
WHAT COUNTRIES DEMAND?
They proposed that exports of food grain from public stocks be allowed for international food
aid and humanitarian purposes to the needy countries.
“The proposal has a huge political weight behind it, and it is crucial as such a large number of
countries have come together at a time when global food prices are rising and they need to
ensure public stockholding of food,”

54. 60 WTO NATIONS BACK NEW METHOD
ON FOOD SUBSIDIES

55. 3..WTO: INDIA AGAINST CUSTOMS DUTIES MORATORIUM
CONTINUATION ON ECOMM TRADE
• Synopsis
• Citing the importance of developing nations to preserve policy space for their digital advancement, regulate
imports and generate revenue through customs duties, the official said that India believes that a
reconsideration of the moratorium is crucial.
• BACKGROUND STORY
WTO members have agreed not to impose customs duties on electronic transmissions since 1998 and the
moratorium has been periodically extended at successive ministerial conferences (MC). The 12th MC of the WTO
will be held from June 12-15 in Geneva.
The United Nations Conference on Trade and Development has estimated the potential tariff revenue loss for
developing countries every year due to the moratorium on e-transmissions at $10 billion as compared to only
$289 million for high-income countries.
The moratorium is on digitisable products like photographic films, cinematographic films, printed matter, music,
media, software, and video games.

56. Many WTO members are seeking temporary extension of
the moratorium till the next ministerial but India does not
want it to continue that further. India will take a hard stand
this time on the matter,” the official said.
Arguing that digital trade at present is dominated by
developed countries, India and South Africa have said that
the moratorium favours them.

57. I
INDIA FACING DIFFICULTIES WITH WTO ON EXPORTING CEREALS AMIDST GLOBAL
FOOD CRISIS: FM NIRMALA SITHARAMAN
Amidst a global shortage of food grains in the aftermath of the Ukrainian war, countries like
India which have the potential to address this by exporting agricultural products, in particular
cereals, are facing difficulties from the World Trade Organization.
As quoted by our FM, Nirmala Sitharaman:
"I was very positively inspired by the fact that in the plenary...response from the WTO was very
positive. I hope we'll break that decade-long restriction which has held us back from using our
agricultural products after taking care of the buffer we need for food security purposes. So
that the farmers also can get a better return," Sitharaman said in response to a question.
She said India has identified opportunities of export of food grains and also manufacturing in
the aftermath of the Ukrainian crisis.
SOURCE:ECONOMIC TIMES

58. THANK YOU