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UPSC 2017-18: PIB Summary and Analysis July 31

The new Agreement on Trade, Commerce and Transit between India and Bhutan 
has come into force with effect from 29th July 2017
  • The bilateral trade relations between India and Bhutan are governed by the Agreement on Trade, Commerce and Transit between the Government of India and Bhutan. The Agreement provides for a free trade regime between the territories of India and Bhutan. The Agreement also provides for duty free transit of Bhutanese merchandise for trade with third countries.
  • The Agreement was last renewed on 29th July 2006 for a period of ten years. The validity of this Agreement was extended, with effect from 29th July 2016, for a period of one year or till the new agreement comes into force, through exchange of Diplomatic notes.
  • The new Agreement will further strengthen the bilateral trade relations between India and Bhutan.


Mandate of WTO

  • The World Trade Organization (WTO) deals with the rules of trade among nations, as negotiated and agreed among its member countries, and inter alia, also settles trade disputes between its members.
  • Its fundamental principles include non-discrimination in trade matters, freer trade, predictability and transparency.
  • Decision-making is largely based on the principle of consensus. However, the impact of the rules on different member countries and sectors would depend on several factors, both external and internal to a member country, and would consequently vary across countries.
  • Negotiations in a multilateral forum such as the WTO require some give and take, so that the best possible outcomes are achieved.
  • The Government is pushing for outcomes in the priority areas of India’s interest, such as in the area of agriculture negotiations.
  • Under the National Food Security Mission (NFSM), for the year 2017-18, out of a total allocation of Rs. 1720.00 Crore Government has allocated an amount of Rs. 1069.87 Crore for pulses as central share to increase the production of pulses in the country. A programme on Additional Area coverage of Pulses is operational since 2013-14 under the NFSM to increase the production of rabi/ summer pulses through area expansion of rabi pigeon pea, gram, pea and lentil during rabi and, moong and urad during summer in NFSM-Pulses implementing States.
  • The Government believes that a rules-based, non-discriminatory multilateral trading system is necessary for bringing transparency, equity and fair play into global trade relations. The multilateral trading system potentially offers a suitable institutional architecture for a developing country.
  • While framing trade-related policies, the Government is mindful of the need to ensure that these are aligned with India’s obligations and commitments under various WTO Agreements.
  • Internal economic and market reforms are an ongoing autonomous process based on national goals and priorities. These include strengthening and upgradation of trade-related infrastructure, steps to enhance the ease of doing business, steps to improve India’s export competitiveness and deepen engagements with new markets, deepen and widen the export basket and promote product standards, packaging and branding of Indian products.
  • India has a long standing position on the need to prioritize the agreed mandate of the Doha Round, in particular, the Ministerial decision to find a permanent solution by December 2017 on public stockholding for food security purposes, which relates to protection of our food-grain procurement programme at Minimum Support Prices and subsidized distribution to economically weaker sections.
  • The Government is committed to pursuing this issue in the WTO in order to take forward the mandate given in the Bali and Nairobi Ministerial Conferences of the WTO in 2013 and 2015 respectively. India is seeking to implement the decisions on the issue through active and constructive engagement with Member countries.
  • Further, India’s proposal for facilitating trade in services in the WTO was made with the objective of imparting much needed momentum to the discussion on services. The proposal provides a framework to address the various impediments to trade in services in a comprehensive and holistic manner. The proposal has been discussed in the relevant services bodies of the WTO.


Consumption and Production of Rubber
  • In order to increase production of Natural Rubber in the country the Government through the Rubber Board is implementing the scheme “Sustainable and Inclusive Development of Natural Rubber Sector” wherein support is provided for plantation development and extension, strengthening research, technology upgradation and market development, Human resource development etc. So far as artificial/synthetic rubber is concerned, Chemical & Petrochemical Industry is delicensed and decontrolled and Government acts as facilitator in this sector.


19th RCEP Meeting
  • The nineteenth round of the Regional Comprehensive Economic Partnership (RCEP) gatherings were held in Hyderabad, India.
  • RCEP is a proposed comprehensive regional economic integration agreement among the 10-ASEAN nations (Brunei Darussalam, Cambodia, Indonesia, Laos, Malaysia, Myanmar, Philippines, Singapore, Thailand, and Vietnam) and its six Free Trade Agreements (FTAs) accomplices, viz. Australia, New Zealand, Japan, China, Korea and India.

Issues discussed

  • Trade in Goods
  • Trade in Services and Investment
  • Intellectual Property
  • electronic commerce
  • Legal and Institutional Issues etc.


ZED Scheme for MSMEs
  • The Government has launched a new scheme namely “Financial Support to MSMEs in ZED Certification Scheme”.
  • The objective of the scheme for promotion of Zero Defect and Zero Effect (ZED) manufacturing amongst micro, small and medium enterprises (MSMEs) and ZED Assessment for their certification so as to:
  • Develop an Ecosystem for Zero Defect Manufacturing in MSMEs.
  • Promote adaptation of Quality tools/systems and Energy Efficient manufacturing.
  • Enable MSMEs for manufacturing of quality products.
  • Encourage MSMEs to constantly upgrade their quality standards in products and processes.
  • Drive manufacturing with adoption of Zero Defect production processes and without impacting the environment.
  • Support ‘Make in India’ campaign.
  • Develop professionals in the area of ZED manufacturing and certification.


UPSC Mains Practice Questions
  1. “The broader aims and objectives of WTO are to manage and promote international trade in the era of globalization. But the Doha round of negotiations seems doomed due to differences between the developed and the developing countries.” Discuss in the Indian perspective. (UPSC Mains 2016, GS Paper 2)
  1. WTO is an important international institution where decisions taken affect countries in profound manner. What is the mandate of WTO and how binding are their decisions? Critically analyse India’s stand on the latest round of talks on Food security. (UPSC Mains 2014 GS Paper 2)




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