WTO’s investment facilitation negotiations are not illegal

Syllabus: GS II, Subject: International Relations, Topic: Regional and global groupings, Issue: World Trade Organization (WTO)

Context: Non-adoption of the agreement on investment facilitation for development (IFD) at MC13 of the WTO

Investment facilitation for development (IFD):

  • Negotiations for an IFD agreement began in 2017 on a plurilateral basis by 70 countries.
  • The agreement was finalized in November 2023.
  • The agreement aims to create legally binding provisions to facilitate investment flows.
  • Focuses on enhancing regulatory transparency and administrative procedures to boost foreign investment.
  • Lacks provisions on market access, investment protection, and investor-state dispute settlement (ISDS).

    India’s concern with IFD:

  • India highlights the absence of a mandate for WTO negotiations on investment.
  • India refers decisions from the 2004 General Council and 2015 Nairobi ministerial.
  • IFD negotiations were launched on a plurilateral basis, not multilateral, challenging the application of the negative mandate.


  • Plurilateral agreements like the IFD agreement are viewed as essential for revitalizing the WTO’s legislative function amidst consensus challenges.
  • India, as a major economy, may benefit from reevaluating its defensive stance on issues like the proposed IFD Agreement.
Prelims Connect (Plurilateral agreements)

·       Article II.3 of the WTO Agreement permits plurilateral agreements, which bind accepting member countries without obligating non-participants.

·       PAs offer a mechanism for advancing specific trade objectives among willing WTO members.

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