A STUDY ON ROLE OF INTERNATIONAL INSTITUTE AND REGULATORY

BODIES WITH SPECIAL REFERENCE TO WTO

 SUBMITTED BY SHAH AAFREEN MOHAMMED AMIN

                                       FOR THE PARTIAL FULFILLMENT OF THE REWARD OF THE

DEGREE OF MASTER OF COMMERCE IN BUSINESS MANAGEMENT

 PART II - SEMESTER III

FOR THE SUBJECT OF INTERNATIONAL MANAGEMENT

 UNDER THE GUIDANCE OF   DR. AMIT PRAJAPATI

            K. J. SOMAIYA COLLEGE OF SCIENCE & COMMERCE

VIDYAVIHAR, MUMBAI 400077.

WTO (WORLD TRADE ORGANISATION)

The World Trade Organization (WTO) is the only global international organization dealing with the rules of trade between nations. At its heart are the WTO agreements, negotiated and signed by the bulk of the world’s trading nations and ratified in their parliaments. The goal is to help producers of goods and services, exporters, and importers conduct their business.

FACT FILE Location: Geneva, Switzerland Established: 1 January 1995 Created by: Uruguay Round negotiations

(1986-94)  Membership: 161 countries on

26 April 2015 Budget: 197 million Swiss francs for 2015 Secretariat staff: 640 Head: Roberto Azevêdo (Director-General) Functions:

• Administering WTO trade agreements• Forum for trade negotiations• Handling trade disputes• Monitoring national trade policies• Technical assistance and training for developing countries• Cooperation with other international organizations

OBJECTIVES OF WTO

WHAT DO WTO DO?The 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 years) or by their ambassadors or delegates (who meet

regularly in Geneva).

While the WTO is driven by its member states, it could not function without its Secretariat to coordinate the activities.

The Secretariat employs over 600 staff, and its experts — lawyers, economists, statisticians and communications

experts — assist WTO members on a daily basis to ensure, among other things, that negotiations progress smoothly,

and that the rules of international trade are correctly applied and enforced.

FUNCTIONS OF WTO

OUTREACH: The WTO maintains regular dialogue with non-governmental organizations,

parliamentarians, other international organizations, the media and the general public on various aspects of the WTO and the ongoing Doha negotiations, with

the aim of enhancing cooperation and increasing awareness of WTO activities.

IMPLEMENTATION AND MONITORING: WTO agreements require governments to make their trade policies transparent by notifying the WTO

about laws in force and measures adopted. Various WTO councils and committees seek to ensure that

these requirements are being followed and that WTO agreements are being properly implemented.

TRADE NEGOCIATION: The WTO agreements cover goods, services and intellectual property. They spell out the principles of liberalization, and the permitted

exceptions. They include individual countries commitments to lower customs tariffs and other

trade barriers, and to open and keep open services markets.

BUILDING TRADE CAPACITY:WTO agreements contain special provision for

developing countries, including longer time periods to implement agreements and

commitments, measures to increase their trading opportunities, and support to help them build their trade capacity, to handle

disputes and to implement technical standards.

DISPUTE SETTLEMENT: The WTO’s procedure for resolving trade quarrels under the

Dispute Settlement Understanding is vital for enforcing the rules and therefore for

ensuring that trade flows smoothly. Countries bring disputes to the WTO if they think their rights under the agreements are

being infringed. Judgements by specially appointed independent experts are based on interpretations of the agreements and

individual countries’ commitment

Members and observers of WTO

FIVE PRINCIPLES OF WTO

Non-discrimination.

Reciprocity

Binding and enforceable commitments.

Transparency

Safety valves

STRUCTURE OF WTO

India is one of the founder member of WTO

The impact of WTO on indian economy

The world trade organisation was established to deal with all major aspects of international trade and it had far reaching effects not only on indias foreign trade but also on its internal economy

The impact of WTO on indian economy can be analysed on the basis and general concepts

FAVOURABLE IMPACTThe WTO has both favourable and non favourable

impact on the indian economy Favourable impact:1)INCREASE IN EXPORT EARNINGS: Increase in

export earnings can be viewed from merchandise exports and growth in service exports:

a)Growth in merchandise exports:Indias merchandise exports have increased from 32 billion US $(1995) to 185 billion US $

b)Growth in service exports:Indias service exports have increased from 5 billion US $ (1995) to 102 billion US $(software services accounted to 45% of indias service exports)

FAVOURABLE IMPACT

2)AGRICULTURAL EXPORTS: Reduction of trade barriers and and domestic subsidies raise the price of agricultural products in international market india hopes to benefit from this higher export earnings from agriculture.

3)TEXTILES AND CLOTHINGS: The phasing out of the MFA will largely benefit the textiles sectors it will help the developing countries like india to increase the exports of textiles and clothings.

FAVOURABLE IMPACT

4)FOREIGN DIRECT INVESTMENT: As per the TRIMS agreement, restrictions on foreign investment have been withdrawn by the member nations of WTO this has benefited the developing countries by way of foreign direct investment in 2008-2009 the net foreign direct investment was 35 billion US $.

5)MULTILATERAL RULES AND DISCIPLINE: It is expected that fair trade conditions will be created due to rules and discipline related to practices like antidumping,subsidies,countervailing measures,safeguards and dispute settlements such conditions will benefit india in its attempt to globalise its economy.

UNFAVOURABLE IMPACT UNFAVOURABLE IMPACT:1)TRIPS:Protection of intellectual property rights has been

one of the major concerns of WTO. As a member of WTO,india has comply with the TRIPS standards

However the agreement on TRIPS goes against the indian patents act,1970,in thefollowing ways :

a)Pharmaceutical sector: Indian pharmaceutical campanies could sell good quality products (medicines)at low prices, however under TRIPS agreement,product patents will also be granted that will raise the prices of medicines,thus keeping them out of reach of the poor people,fortunately, most of drugs manufactured in india are off-patents and so will be less effected

UNFAVOURABLE IMPACT

2)TRIMS:The agreement on TRIMS also favours developed antions as there are no rules in the agreement to firmulate international rules for controlling business practices of foreign investors also complying with the TRIMS agreement will contradict our objective of self reliant growth based on locally available technology and resources

UNFAVOURABLE IMPACT

b)Agriculture: since the agreement of TRIPS extends to agriculture as well ; it will considerably impact on indian agriculturethe MNCs with their large financial resources may also take over the seeds production and will eventually control food production. Since a large majority of indian populations depends on agriculture for their livelihood, these development will have serious consequences

3)GATS: The agreement on GATS will also favour the developed nations more. Thus rapidly growing service sector in india will now have to compete with gaint foreign firms moreover since foreign firms are allowed to remit their profits,dividends and royalties to their parent company, it will cause foreign exchange burden for india

4)TRADE AND NON TARDE BARRIERS5)LDC EXPORTS

CONCLUSION Thus the WTO is a powerful body that will enact

international laws on various matters It will also globalise many countries and help them to

develop their competitive advantages and seek benefits from advanced technology of other nations.

Though countries like india will face serious problems by complying to the WTO agreements,

It can also benefit from it by taking advantage of the changing international environment.

REFERENCE https://www.wto.org/english/thewto_e/whatis_e/tif_e/

org6_e.htm https://www.wto.org/english/res_e/res_e.htm https://www.wto.org/english/thewto_e/whatis_e/tif_e/

org2_e.htm INDIA and WTO - Google Search WTO | Understanding the WTO - organization chart