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Which one among the following is not a clause of World Trade Organization ?
Explanation
The World Trade Organization (WTO) is built on several core principles and clauses. These include the Most Favoured Nation (MFN) treatment, which ensures non-discrimination among trading partners [2]. Another central clause is the progressive liberalization of trade by lowering barriers such as tariffs and quotas through negotiations [3]. Furthermore, the WTO aims to promote fair competition by discouraging unfair trade practices, specifically targeting dumping and export subsidies through agreements like the SCM Agreement [3]. However, providing financial support to countries with balance of payments (BoP) deficits is not a function or clause of the WTO. While the WTO allows members to restrict trade to safeguard their BoP under specific conditions [5], the actual provision of financial assistance for BoP deficits is the mandate of the International Monetary Fund (IMF), not the WTO.
Sources
- [1] Indian Economy, Vivek Singh (7th ed. 2023-24) > Chapter 13: International Organizations > 1. Trade without discrimination: > p. 379
- [2] Indian Economy, Vivek Singh (7th ed. 2023-24) > Chapter 13: International Organizations > 2. Free Trade (gradually through negotiation) > p. 380
- [3] Indian Economy, Vivek Singh (7th ed. 2023-24) > Chapter 13: International Organizations > The following are some of the important features regarding WTO > p. 378
- [5] https://www.wto.org/english/res_e/booksp_e/agrmntseries2_gatt_e.pdf