World Trade Organisation :
The General Agreement for Tariffs and Trade (GATT) was transformed into the World Trade Organisation (WTO) with effect from 1st January 1995. The headquarters of the WTO are situated in Geneva, Switzerland. The World Trade Organization deals with the global rules of trade between nations. Its main function is to ensure that trade flows as smoothly, predictably and freely as possible. It is concerned with solving trade problems between countries and providing a forum for multilateral trade negotiations. It has a global status similar to that of the IMF and the World Bank. India is a founding member of WTO.
Objectives of WTO:
- To ensure a reduction of tariffs and other trade barriers imposed by different countries.
- To engage in activities which improve the standards of living, create employment, increase Income, facilitate higher production and trade.
- To facilitate the optimal use of the world’s resources.
- To promote an integrated, more viable and durable trading system.
Functions of WTO:
- To remove barriers to international trade.
- Act as a dispute settlement body.
- To ensure that all the rules regulations prescribed in the Act are duly followed by the member countries for the settlement of their disputes.
- Laying down a commonly accepted code of conduct for international trade.
- To consult with IMF, IBRD and its affiliated agencies to bring better understanding and cooperation in global economic policymaking.
Benefits of WTO:
- It helps to promote international peace and facilitates international business.
- All disputes between member nations are settled with mutual consultations.
- It makes international trade and relations very smooth and predictable.
- Free trade improves the standard of living of the people by increasing the income level.
- Free trade provides an opportunity for getting varieties of qualitative products.
- Economic growth has been increased.