Paper: GS – II, Subject: International Relations, Topic: India Relations with Major Countries, Issue: Global Trade Dynamics.
Context:
As multilateralism weakens with an ineffective UN Security Council and a stalled WTO dispute settlement system India remains committed to WTO processes and is preparing for its eighth trade policy review after five years.
This comes as the US shifts toward bilateral trade deals, raising concerns among experts about risks to the rules-based system and potential disadvantages for developing countries like India.
Key Takeaways:
| Key Facts About European Union: Founded: In 1951 after the Second World War (1939–45) by six countries (Belgium, France, Germany, Italy, Luxembourg, and the Netherlands). Current Member States: 27 countries (Austria, Belgium, Bulgaria, Croatia, Republic of Cyprus, Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain and Sweden). The UK joined the EU in 1973 and left (brexit) in 2020. Demography: In EU, Germany has the largest population, France is the largest by area and Smallest Country is Malta. Open Borders: The Schengen Area allows free movement for most EU members, excluding Cyprus and Ireland. Four non-EU countries (Iceland, Norway, Switzerland, and Liechtenstein) are also part of Schengen. Single Market: Goods, services, capital, and people circulate freely within the EU. Climate Goals: Aim to become climate-neutral by 2050, reduce emissions by 55% by 2030. India was amongst the first countries to establish diplomatic relations with the European Economic Community in 1962. |
Implications for India:
- Importance of WTO for Dispute Resolution: The WTO is crucial for India, as it has been filing several disputes against the US while negotiating a bilateral trade agreement.
- Risk to Rules-Based System: The US’s shift towards bilateral deals poses a significant risk to the rules-based system and developing countries like India.
Challenges and Potential Impacts on India:
By actively working to strengthen the WTO, engaging with key trading partners, diversifying its trade relationships, and enhancing its domestic competitiveness, India can navigate these challenges and secure its economic interests in the evolving global trade landscape.
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