India and the World ° Trade Organisation 3° =e &*gantsation (WTO) renewed agreements and having a new vision and tou international trade. WTO consists of a council for goods, a council for services and a council for intellectual property rights. WTO along with World Bank and the IMF, will greatly influence global trade policy. The declaration on the contribution of the WTO to achieving greater coherence in Global Economic Policy-making identifies the need for strengthening the relationship between the activities of the WTO, IMF and the World Bank asa way of ensuring greater coherence in global economic policy-making. 1. Objectives, Scope and Functions of the WTO WTO isan international organisation similar in status to International Monetary Fund (IMF) and International Bank for Reconstruction and Development (IBRD) having authority not only in trade in industrial products but also in agricultural products and services. Unlike GATT, WTO has a permanent legal status with a set of rules and procedures on multilateral trade agreements, which are not binding on member countries, Any member can stay out ofan agreement without signing it son the day of its inception, there were 77 member countries with India as its one of the founding member. Since then the number of member countries of WTO has been increasing, Presently, there are 159 member countries of WTO. Objectives, scope and functions of the WTO are described as under: igher enforcement power to promote164 Economic Development and Policy in India © Objectives of the WTO Important objectives of the WTO are as follows: (i) The primary aim of WTO is to implement the new world trade system as visualised in the agreement. (ii) To promote world trade in a manner that benefits every country, (iii) To ensure that developing countries secure a better balance in the sharing of the advantages resulting from the expansion of international trade corresponding to their developmental needs. Gv) To demolish all hurdles to an open world trading system and usher in international economic renaissance because the world trade is an effective instrument to foster . economic growth. (x) To enhance competitiveness among all trading partners so as to benefit consumers and help in global integration. (vi) To increase the level of production and productivity with a view to improving the level of employment in the world. (vii) To expand and utilise world resources to the best. (viii) To improve the level.of living for the global population and speed up economic development of the member nations. These objectives ofthe WTO ate more or less similar to the objectives of GATT. However, under the WTO these are sought to be achieved following a more rigorous and tougher enforcement of the policy of export competition, market access and free trade. © Scope of the WTO Traditionally, GATT was concerned with international trade in manufactured goods only. ‘The General Agreement on Trade in Services (GATS) is the first multilateral agreement on trade (under WTO) focusing on the progressive liberalisation of trade in services. The agreement covers trade in all service sectors and the supply of service in all forms. Agriculture, a controversial area, has been included and other areas having implication for the production process of goods are being gradually covered. The new areas included under trade agreements are: (1) Trade Related Intellectual Property Rights (TRIPs). (2) Trade Related Investment Measures (TRIMS). (8) General Agreement on Trade in Services (GATS). WTO thus has much scope than GATT as it covers a variety of goods and services for the general agreement on international trade. Also, WTO has tougher implementation power and wider acceptance for the implementation of the agreement than GATT. © Functions of the WTO As per the preamble ofthe World Trade Organisation declared by the m coe to perform five important functions, as under: suber Dations i hasseuMeNMINVVUVVvVVUVUuUVeVUUVUeCUceCTCeCeTCUeCUCOCUCUCUOUCUCUCUC NCU OCU MCU TCU VUCCULV Inc dla and the World Trade Organisation (WTO, 168 te multilateral trade agreements, and their implementation. WTO is to in regard to the administration, operations and implementation of multilateral trade agreements and other agreements are concerned. wTo shall also facilitate the administration, implementation, and operationalisation of plurilateral trade agreements. ) WTO is to negotiate all matters of the member countries relating to multilateral trade. ‘Thus, itis to provide a negotiation platform to its members for solving their trade-related problems. (iv) WTO isto administer rules and procedures concerning settlement of disputes among the trading partners. (v) WTO is to work in tandem with IMF, World Bank and their affiliated organisations for achieving better results in the area of international trade. 2, World Trade Organisation—Some Agreements () Trade in Agriculture: For more than four decades, agricultural sector remained exclusive of GATT agreements. But the Uruguay Round achieved a major break through by bringing the agricultural sector within the perview of WTO. The Agreement requires that participating governments do not “maintain, resort to or revertto any measures of the kind which have been converted into ordinary customs duties” (Article 42 of the agreement on agriculture) Increased market access for agricultural products includes the “tariffication” of all non-tariff measures (conversion of tariff equivalents) — with the exception of those products for which special treatment has been negotiated — and a binding of all tariffs on agricultural products. The measures to be so converted include virtually all Non-Tariff Measures which include quantitative import restrictions, variable import levies, minimum import prices, discretionary importlicensing, and non-tariff measures maintained through state trading enterprises and voluntary export restraints. This was to ensure security of trade in agricultural products. Agricultural trade has remained the most disputed of all the issues. However there was a consensus on the need for a reform of agricultural trading policies. The major feature of the final act are summarised below: (1) Domestic Support: It includes assistance to production. All countries have to reduce domestic support price known as Aggregate Measures for Support (AMS), ifitis in excess of five per cent of the total value of production in case of developed countries, and 10 per cent of the total value of production in case of developing countries. Even if AMS exceeds 10 per cent it has to be reduced in either US $ or domestic currency terms by 13.3 per cent over 10 years while developed countries have to reduce it by 20 per cent over six years. Also, non-tariff barriers shall be replaced by customs duties. (2) Export Competition:’ Spread of international competition is the undercurrent of objectives of WTO even though the Preamble of the WTO does not explicitly stateit. The rules and proceduresframed under WTO favour competition in product market and also favour competitionie Economic Development and Policy in India among the regulatory regimes, Trade liberalisation isa fundamental component of any policy that seeks to enhance competition in the international markets. (3) Market Access: ‘The WTO. prescribes rules for Trade Policy Review Mechanism and administers their implementation. Through reduction in trade barriers and abolition of discriminatory trade practices WTO secks to enhance market access, Market accessis also enhanced through tariff bindings. The WTO rules allow a contracting party to contest measures employed by another contracting party that nullify or impair such bindings/agreements. In the context of market access, following regulations by WTO are of notable significance @) Non-tariff measures are converted into ad valorem or specific tariffs. i) Tariff are bound and are to be gradually reduced over a period of six years. (it) A tariff binding is the legally set maximum rate at which a tariff may be set. (oy) Investment subsidies are to be available to low income or resource poor producers. These subsidies need not be reduced by the developing countries. The developed countries do not have this option. (¥) Actual tariff can be below the specifies renegotiated by the trading partners. (vi) The developing countries have been tapering off subsidies. d rate, but cannot go above it unless. the rate is given a period of ten years (instead of six years) for (vii) While industrial countries are required to reduce tariffby 36 per cent over six years, the developing countries are to reduce them by 24 per cent over 10 years. (iit) The least developed countries are not required to make any reduction in subsidies. However, they are prohibited from maintaining non-tariff measures as well. (M1) Trade in Textile and Clothing: Discriminatory quantitative restrictions have been prevalent in the textiles and clothing sector for over 30 years under Short-Term Arrangements, Long Term Arrangements until 1974 and Multi-Fibre Arrangements (MFAs) up to 31 December, 1994. The MFA were a series of bil: laterally negotiated quotas to limit the access of developing Countries textile exports to the developed countries during the fifties, Protect the US textile producers from external supplies. Later on developing countries including India. ‘These quantitative restrictions had number of products over the years and had become incre: (i) The Agreement on Textiles and ‘othing provides for prohibition of any such restrictions on free exportsand elimination of MEA type arts ngement. The quantita restrictions only affect exports of developing counties to the industtial countries avd Hot the trade among the industrial countries themselves. The implementation at whe Agreement by the WTO on textile and clothing would mean the elimination of MPN cy the elimination of all non-tariff barriers in textile td clothing industries over a period of 10 years (1995-2004) and integration of these industries with free-trade system under WTO by January 1, 2005, Gi) Reduction/elimination of non-tari(t barriers was Division of 10 year period will be in three Ttwas basically designed to it was extended to many covered a growing singly restrictive over time. e planned to be achie ‘ved in Phases: stages: 16 per cent by first thy ree years; 17 perNew vob bobvvedercdi ddd seddddca ladia and the World Trade Organisation (WTC 167 cent by next four years and another 18 per cent by next three years. Thus, 51 percent of the total imports will be integrated into the free trade system of the WTO by January 1, 2002 while the remaining 49 per cent will be integrated by January 1, 2005. (iii) Under WTO system, the countries can introduce discriminatory restrictions on the products which were not subjected to GATT or WTO rules or on which they did not have bilateral arrangement. (iv) The safeguard mechanism protecting interest of the developing countries would remain in place for a period of three years. The developing countries are allowed to practice non-tariff barriers in case imports are threatening their domestic industries. (1) Trade Related Intellectual Property Rights (TRIPs): TRIPs related to nine types of intellectual property. The Agreement is yet to specify norms and standards of protection. However, a provision also made to review the status after four years from 1999. In the meantime, member countries are given the option of following ‘Sui-Generis System’ in place of patenting. Countries, where there is no tradition for ‘Patents’, have been granted grace period of 10 years to introduce the same. Incidently, patents are given to inventions and innovations and not for discoveries. Accordingly, following items will remain outside the preview of patents: plants, animals, biological system related to procreation of plants and animals and all such products which are detrimental to man, animal or the general environment. India has accepted ‘Sui-Generis’ system. Itis different from ‘patents’ and commonly refers to the system of protection of ‘Plant Breeders Right’ (PBR). It allows farmers to retain the seed use them on their own farm of exchange them with the neighbouring farmers. The only restriction is that ‘Commercial Sale’ of branded seeds is not allowed. Only the owners of the Plant Breeders Right will produce and market their breeded plants. (IV) Trade Related Investment Measures (TRIMS): Like subsidies, certain trade related investment measures afe regarded as a ‘form of protection’ which divert and enhance inefficient production. TRIMs provide for abolition of al such restrictions, measures and conditions imposed on foreign investors. Member countries are required: (i) toffer national treatment and all such facilities to all foreign investors as are available to their domestic investors, (ii) to remove all TRIMs within a period of five years, (ii) not to force external investors, to make investment in the ‘priority and (iv) to extend all facilities to foreign investors so as to raise the level of global output and employment and thereby ease the ‘balance of payments’ problems of the member countries. “The provision of TRIMs under WTO opens up opportunity for foreign investors to invest anywhere in the world in any economic activity. The Agreement further ensures that all the units ae her ‘indigenous’ or ‘foreign’ shall be treated at par without any discrimination in terms of regulations and policies. A condition however can be imposed regarding fulfilment of export obligation to balance the outflow and inflow of foreign exchange for such venture. areas’ of host country,ic lopment and Policy i 168 Economic Develop i Hey in nda (V) General Agreement on Trade in Services (GATS): The General Aarecnent on Tr. Services (GATS) is the first multilater agreement on trade focusing on oes liberalisation, of, trade in services. It provides for secure and more open market in services in a similar manneras the GATT provided for trade in goods, The Agreement covers trade inal service sectors and the supply of service in all forms. adein ‘Trade in services has been defined as the supply of a service through Production, distribution, sale or delivery by the physical presence of enterprises. WTO provides free trade in these services only which are based on ‘advanced technology’ as related to banking, shipping, transport, telecommunication, rest to developing feral ofthe WTO to shorter time-limits in tomatic access to the “good offi find a satisfactory resolution mplete their deliberations, ices” of the Director Gen to the dispute, and the s which panels must co} inst India becoming a membe T of the WTO,GOULLCOLEHEs let an Mkt Meade Omanigation (ro) © Argument Againat India Critios are atthe Smentson the provisions ofthe GATT or the WTO will be beneticial 40 developed ree nities lone and underdeveloped countries Hike tnd at Katy of reign companion in Nulla will vob one enti bhiaclered on the pattern of Kant Unda Company, O1 Spied that the tinal document of the Garr “wtony of developed countries once tuling party for such 169 OF Mombor ot wro NOW that grey sand to lose. and traditions and the country will be © Fommunist leader Somnath Chatterjee the WTO isa document that will render Ind Wag Kenetations ofthe nation will never forgive the ing MMAMICHIS ate given against GATT of wro; 1 Sector: Iti apprehended that by includ ing become dependanton mulinatie gain, # blunder: Rotlow (1) Disadvantage to Agricultura GATT OF WTO, maian frmera yi Scedsand agricultural technology. The Lumens will not be able to their crop ancl wil be compelled yo buy patented seeds at high using patented seeds amount to using improved fir affordable range of the bulk of farming population in In holders. ig farmersalone willbeable totakeadvant consequence would be that smal finn Problem of unemploymentin rural secron Also, plants pitents and accordingly under the control nt multina Pantha (@ business interest ofthe Indian firmery und Further by increasing marketeexposure of the Indi “Pact of such polices as of minimum support Price (2) Reduction in Subsidy: Critics are of the opinion that afte Agreements, subsidy t cultural sector willbe slashed. Iwill only, and marginal holders who are in a constant struggle to eke 3) Import of Foodgrain: surplus of foodgrain production o| markets of less developed countries agriculture in nies for improved Wve superior quality seeds from cin the open market. Ofcourse, technology, but it would be beyond the net which comprises st ‘age ofimproved fi mers will be forced to sell thei and marginal n technology, The ultimate inds. This will aggravate the «cate feeds will come under the ambit of tional con } This will certainly be eriaking horticulture and cate farming. " farmer; patenting will only neutralise the concluding GATT or WTO compound the misery of small ut their living through i is apprehended that through developed countries will find an easy access to the domestic ®: Ie will adversely allect their bakance of payments, (A) Use of Branded Seeds: Only big will be difficult for small and n the economic divided between ming, ‘ATT or WTO Agreements, Hers can buy expensive branded vatieties of seeds, ke anginal farmers to use improved vatieties of seeds, It will aggravate rich and the poor in rural areas () Patent Rights of Natural Products: If foreign MNCs ook initiative and secured patent "ghts over minor natural products of India, it may agriculture, For instance, neem can be il to serious consequences for Indian twed for making soap, tooth paste, medicines, etc, Similarly, r oumtries. If these products are there is large demand for Psyllium Husk (sabgol) in forei cone I these p Patented by MNCs, the common man in India will only suffer in silence, (6) Plant Breeding Protection: According to WTO, protection of breeding is to be ountof new Cleterminedl by Sui-Geners system, Indian farmers have to spend huge amount of money to ge and improved variety of plants. Also, their dependence on multinational companies will further increase,170 Economic Development and Policy in India smpoc) ATBUMeNts against TRIMs: The Provision of TRIMs under WTO prevents India from imposi 'ng Testrictions on foreign invest establish their industries in India, WI carries the danger of exposing dom: ment. Consequently, multinational companies will be free to hile this will increase foreign direct investment in India, it also lestic industry to international competition. Itis a hard fact that domestic industry cannot compete with MNGs, owing to high cost of production, related to backward technology. Consequently, itis feared that domestic industry will be marginalised causing a shift of domestic demand in favour of MNCs. (8) Patent Rights: Unlike developed nations, India does not recognise patents in the field of medicines, foodgrains and chemical products. However, in due course, all member countries of WTO are required to accord recognition to product patents. India has been given a period of ten Years to make provisions for the patents. With the enforcement of this system, prices ofthe existing medicines are expected to take a steep hike. Multinational companies may file claims against soPying their patents. Indian researchers will face the formidable task of proving them to be wrong. In this context it may be noted that complaints will be filed by the complainant in their home country. Where dispensation of justice is very expensive involving huge compensation in case of defaults. Indian pharmaceutical industry will be hard hit by patent agreements. While MNCs will charge exorbitant prices for their patented medicines. (9) Foreign Ownership of Plants and Animals: Plants and animals have also been included in the perview of WTO agreements. These can be purchased by MNCs which will give great leverage to these companies in terms of their control of fragile economies of less developed countries like India. (10) Arguments against TRIPs: It is argued that TRIPs will discourage the process of research and innovation in the country. Critics are of the opinion that itis unjust to have uniforea Standards for all member countries because these standards vary with economic and technical development of each country. The level of technology found in the developed country can hardly be reached by the developing countries. India will therefore stand to lose. Any setback to research and innovation process will accentuate the backwardness of our agriculture, will be beyond the reach of an ordinary man, (11) Disadvantages to Service Sector: It is feared that WTO will adversely affect our service sector. Banking, insurance, transport, education and hotel services as offered by MNCsarea superior compared with their domestic standards, As a result, indigenous units engaged in rendering these services will be marginalised to wind up, causing a blow to the domestic entrepreneurship. © Argument in Favour of India as a Member of WTO Arguments in favour of India asa member of WTO are based on the fol (1) Multilateral Trade Negotiations: Multilateral tr the benefits of Most Favoured Nation status. Asa member of the WTO, it wil enter into multilateral trade agreements with 124 countries, There bilateral agreements with different countries. Besides, expand with the opening of new markets. It is hoped t and medical services lowing observatior rade negotiations offer member countries Ibe possible for India to will be no need to enter into custom tariffs will slash and trade will hat as a result of WTO agreements worldIndia and the World Trade Organisation (WTO) a ne will witness an increase ranging between 2,000 and 3,000 crore dollars. India has the potential of increasing its trade by 150 to 200 crore dollars, solely on account of WTO membership. ___@) NoReduction in Subsidies: Itis wrong to argue that India has to enforce cut in subsidies in agricultural sector asa result of the WTO membership. The question of reduction in subsidy arises only when it is more than 10 per cent of the production cost. In India, the existing subsidies are much less than 10 per cent. These hover around 3.5 per cent of the production cost. The fact is that with acceptance of WTO proposals, there may emerge the possibilities of enhancing the rate of subsidies. Also, it may be noted that no reduction will be effected in the on-going assistance being istribution system or fair price shops selling foodgrains at concessional provided to the public rates. (8) No Need of Increase in Imports of Foodgrains: The fear tht WTO agreements will push India’s imports of foodgrains is ill founded. Because, countries facing BoP deficit are continue with quantitative restrictions on foodgrain-imports. It is true that India will not have to face balance of payments problem for all times to come, and that agreement related to agriculture is for a period of six years only. But, ifat all India has to import foodgrains, then import duty on foodgrains can be stretched up to 100 per cent, on processed food items it can be 150 per centand on edible oils it an be around 300 per cent. Such a high rate of import duty will render the price of imported foodgrainsin domestic markets quite prohibitive. This will definitely act asa deterrent to the import of foodgains, (4) Increase in Exports of Foodgrains: As a result of reduction in government subsidies on agriculture being given by developed countries, demand for special variety of Indian foodgrains will rise in international market. It will provide opportunity to India to increase export of agricultural products. WTO has recommended a cut in custom duties and reduction in import restrictions. It will also promote agricultural export from India considerably. As a result of this 1 will be possible for countries like India to export rice to Japan and South Korea. proposal, it (5) Freedom to use Seeds: Former Director General of WTO has clarified that the farmer will saved from his crop, for the next sowing. He will also be free to get his seeds ceds of other farmers. Researchers will be able to prepare another variety from al breeder for be free to use seeds, exchanged with the s a reserved variety. However, they will have to seek permissio (6) Patent and Sui-Generis System: Government has ¢ rovision of patenting seeds nor is there any intention of changing this p Fade it clear that in the matter of seed-patent and sui-generis system it wi vtnder which Plant Breeders will be issued certificates, In this system, there will be provision for the rights of the farmers as well as those the researchers. Farmers will be able (0 Bet improved and purified seeds protecting the rights of plant breeders. ‘This will benefit Agricultural Research India and there will be increased investment in Research and Development. ictice in future. Ithasalso make its own provisi Institutes in (7) Dunkel Draft and Agriculture: Dunkel Draft will not adversely hit the interests of our farmers, rather it will bolster agricultural exports, and encourage agricultural research and vjevelopment. All our major projects of agricultural development are outside the purview of the172 Economic Development and Policy in india WTO agreement. After the enforcement of WTO Agreement, we do not have to reduce subsidies being given to the farmers. We do not have to allow free access to domestic markets for the agricultural products of other countries. Farmers will have full right to make use of their crops in the form of seeds or get exchange their seeds with other farmers. No reduction will be made in the Procurement of foodgrains, construction of warehouses for storage of foodgrains and subsidy to Publicdistribution system. In the words of Dr. Manmohan Singh, “W.T.0. is expected to diversify Indian agriculture, encourage India’s multilateral transactions of scientific knowledge and raise productivity standard ‘and output manifold. Government will enhance subsidy and protection to agriculture. (8) Trade Related Intellectual Property Rights—TRIPs: Before the formation of WTO, Dunkel Draft included copyright, trade mark, trade secrets, industrial designs, power supply, geographical indications, and patents under intellectual property rights. The draft is not going to cause any special harm to India, because except patents, in all other spheres, India's judicial and executive systems are of international level. There is difference between the provisions of Indian law and patent provisions of Dunkel Draft especially in the area of medicines. It is, therefore, possible that prices of medicines start climbing up. However, it is worth noting that of the total available medicines in India, hardly 10 to 15 per cent medicines figure in the patent list. As such, there is no point to be over apprehensive on this score. World Health Organisation has kept most essential and life-saving drugs outside the preview of Dunkel Draft. Besides, GATT patent drugs are generally available in our country which will help check escalation of their price. Further the Proposed agreement provides for a grace period of 10 years duiring which imitation of patented medicines is possible. We may develop our own substitutes for the patented medicines. (9) Trade Related Investment Measures—TRIMs: Provisions of WTO under Trade Related Investment Measures arc to the advantage of India. TRIMs which give foreign investors the same rights as to the indigenous investors, does not divest the domestic government ofits right to decide the limits of foreign investment in trade. It also accords freedom to the domestic government to decide about the type of foreign capital investment in the domestic economy. The government will often desire investment in areas which are export friendly so as to cope with BoP deficit. (10) ‘Trade in Services: By including trade in service under WTO proposals, developing countries like India will stand to gain, By allowing MNCs to set up their service establishments in the country, trade in service sector will expand, offering employment to millions of unemployed persons in India. It will check brain-drain to foreign countries and enhance levels of skill formation in the country, (11) Clothing and Textile Industry: WTO agreements are expected to be beneficial to the clothing and textile industry in India. Under Multi Arrangements (MFA), our cloth and readymade garment trade was subject to quota restrictions. As a result of WTO, all these restrictions will be done away with. Export of Indian clothes and textiles will receive a great filip. Withdrawal of quota restrictions will encourage our exports 8 w to America and European countries. It will give a boost to the textile industry and open up new vista in the domestic economy. ~ “ o oo Ss + i a e « > & ¢ ¢ ¢ < ‘ ‘ ( (India and the World Trade Organisation (WTO) 73 ae fees sing pros and cons of India integrating herself with WTO, one is inclined to conclude i ages are far greater than the disadvantages. WTO is a window of opportunities for free rade, and free flow foreign investment and technology across all parts of the globe. In the process, while advanced economies are expected to consolidate their gains of development by securing access to international markets, less developed countries like India are expected to become better abled to kick-start their process of growth and development. The trinity—IMF, World Bank and World Trade Organisation-will foster economic interest of poor nations by integrating their ‘economies among themselves and with those of advanced nations. Poor nations like India will not only have access to global markets for their exports but will also have access to modern technology, updated managerial practices and international investment funds which will transform their backward production-system into robust and competitive production mechanism. India that has joined WTO as its founder-member, can ill-afford to opt out of it. What is needed is that WTO provisions are optimally exploited to promote our business interest, so that India emerges a robust and competitive economy in the world. 4. Progress in fulfilment of India’s Commitments to the World Trade Organisation (WTO) The progress in fulfilment of India’s commitments to the World Trade Organisation may be summarised as under: (1) Quantitative Restrictions (QRs): In 1997, India imposed quantitative restrictions (QRs) on the import of 2,714 goods to cope with BOP crises. However, in accordance with the agreement with WTO in 1999, quantitative restrictions on imports were confined to 1,429 goods only. In the Export-Import Policy, 2000-2001, quantitative restrictions on imports were restricted to 715 goods. By the end of 2002, all quantitative restrictions on imports were abolished. (2) Trade Related Intellectual Property Rights (TRIPs): As per our obligations towards WTO, the agreement on TRIPs sets out the minimum standards of protection to be adopted, in respect of: (i) Copyrights and related Rights; (ii) Trade Marks; (iii) Geographical Indications; (iv) Industrial Designs, and (v) Protection of patents and their enforcement. According to the provisions of the TRIPs agreement, a period of 5 years is available to India to give effect to these standards. Giving effect to her commitments to the WTO, India enforced in 1999, Patents (Amendment) Act. As per this act, firms getting patents will be given exclusive marketing rights, (8) Patents: India has passed, Patent (Amendment) Act, 2005 in deference to WTO agreement. The basic obligation in the area of patents is that inventions in all fields of technology, whether products or processes, shall be patentable if they meet the three tests of being novel, ving an inventive step and being capable of industrial applications, In respect of plant varieties, India is under obligation to provide for protection by patents and/or Sui Generis. The Indian government has taken a decision to put in place Sui Generis system as it is perceived to be in national interest. A legislation to this effect has been tabled in the Parliament by the Minister of Agriculture. involis Economic Development and Policy in India (4) Copyright, Trade Marks and Industrial Designs: India has amended the copyright Act (1957) in 1999 and the Trade and Merchandise Marks Act (1958) in 1999. A new bill has been formulated to protect industrial designs, so as to meet the requirements of WTO. (5) Geographic Indications: The Agreement contains a general obligation that governments shall provide the legal means for interested parties to prevent the use of any means in the presentation of a good that indicates that the good in question originates in a geographical area other than the true place of origin of the good. The government of India has also enacted anew law in December 1999 on geographical indications. (6) Trade Related Investment Measures (TRIMs): Under the TRIMs agreement, developing countries were given a transition period of 5 years, during which they could continue to maintain measures different from the agreement, provided they were duly notified. India notified two TRIMS, first relating to local content requirements in the production of certain pharmaceutical products, and second relating to dividend balancing requirement in the case of investment in 22 categories of consumer items. (7) Tariffs: Our commitments to reduce tariffs to the stipulated limits by Ist March, 2000 remain to be fulfilled in respect of non-agricultural and non-textile items. ee WTO and Less Developed Countries had any country inthe World ahich agres in totality with the proposal in terms of ts gins Tose In thas been so controversial as the proposal for: the WTO. Agreement. There have been several pee Ween Final Act as sean te ion and deed cures wales pron for meas exports of the developing Asian nations, has agreed to Thus, infact, the Agreement seeks to yield real greatly improved by an increase in tariffbinding by significant tariff reduction, and by em ONO OHHHLELRETbvebedbec eee Ce ddeces Vydbdbovobdbbd India and the World Trade Organisation (WTO) 178 eee Gee et © Objectives of the WTO: (i) To promote of world trade, ii) To ensure that developing countries secure a better balance in the sharing of advantages resulting from the expansion of international trade corresponding to their developmental needs, (iii) To demolish all hurdles to an open world trading system, (iv) To enhance competitiveness among all trading partners, (v) To increase the level of production and level of productivity with a view to ensuring level of employment in the world, (vi) To expand and utilise world resources to the best, and (vii) To improve the level of living for the global population. © Some Agreements of WTO: (i) Trade in Agriculture, (ii) Trade in Textile and Clothing, (ii) Trade Related Intellectual Property Rights (TRIPS), (tv) Trade Related Investment Measures, (v) General Agreement on Trade in Services (GAT), (vi) Dispute settlements, (vii) Monitoring of Trade Policies. © Disadvantages of WTO for India: (i) Disadvantage to agricultural sector, (ii) Reduction in subsidy, (ii) Import of foodgrains, (iv) Restrictions on the use of branded seeds, (v) Patent rights of natural products, (vi) Plant breeding protection, (vii) Argument against TRIMS, (vii) Argument against TRIPs, (ix) Foreign ownership of plants and animals, (x) Disadvantages to the service sector, (xi) Disadvantage of patentisation. © Advantages of WTO for India: (i) Advantage in multilateral trade negotiations, (ii) No reduction in subsidies, (iii) No need of increase in imports of foodgrains, (iv) Increase in exports of foodgrains, (v) Freedom to use seeds, (vi) Patent and Sui-Generis System, (vii) Dunkel Draft and agriculture, (viii) Benefits from TRIP, (ix) Benefits from TRIMS, (x) Benefits from trade in services, (xi) Advantage to clothing and textile industry. © India's Commitment to WTO: (i) Quantitative Restrictions were abolished, (i) TRIPs was enforced, (ii) Patent (Amendment) Act was passed to fulfill the obligation concmning patents, (iv) Amendment to the copyright, trade ‘mark and industrial designs was made, (v) A new law was enacted on geographical indications, (vi) TRIMs agreement was followed, (vii) Tariff rates has been reduced. sds 1. Essay Type Questions 1. Discuss the objectives, scope and functions of World Trade Organisation. 2, What do you mean by World Trade Organisation? Give some important agreements of the WTO. 3. Explain fully the nature and functioning of the World Trade Organisation. ‘4, What are the objectives of the WTO? How will you justify the membership ofit for India? 5. Critically examine the relevance of the World Trade Organisation (WTO) for Indian economy. 6. How WTO is expected to affect the agriculturally dominated countries like India? 7. Discuss the role of World Trade Organisation (WTO) in the Indian economy.176 Economic Development and Poll in India Ml. Short Notes 1 . TRIPs. |. TRIMs. » Advantages of the WTO for India, - Disadvantages of the WTO for India, eyae RED WTO and India. Trade in Agriculture agreement of the WTO, General Agreement on Trade in Services (GATS). Furictions of WTO,