Gattnew 111106142553 Phpapp02

Gener al Ag r eement
on Tarif fs and Tr ade

• The General Agreement on Tariffs and Trade
(GATT) was first signed in 1947.
• Was designed
– To provide an international forum
– That encouraged free trade between
member states
– By regulating and reducing tariffs on traded
goods
– Providing a common mechanism for
resolving trade disputes.
GATT……
A Treaty, not an Organization
• Was the outcome of the failure of negotiating

governments to create the ITO (International Trade
Organization)
• The Bretton Woods Conference introduced the idea for

an organization to regulate trade as part of a larger plan
for economic recovery after World War II
• As governments negotiated the ITO, 15 negotiating

states began parallel negotiations for the GATT as a way
to attain early tariff reductions
• Once the ITO failed in 1950, only the GATT agreement

was left.
Objective
• The GATT's main objective was the
“Reduction of Barriers to International Trade”
• This was achieved through the Reduction of
– Tariff barriers
– Quantitative Restrictions
– Subsidies on trade through a series of agreements

Function of GATT
• Most favored Function Status.
• National Treatment
• Protection through tariff.
• Dispute Settlement.
• Trade Negotiation among Developing Countries.

Why did we need GATT…..???
When did it all start….

Did GATT succeed?
•Increased world trade growth 1950s and
1960s — around 8% a year on average
• With Trade growth, production growth was

also witnessed.
•Recognition of multilateral trading system as

the anchor for development and an instrument
of economic and trade reform.
But…….
• Every country started protecting their home industry.
• High rates of unemployment and constant factory closures led

governments in Western Europe and North America to
• Both these changes undermined GATT’s credibility and effectiveness.

• World trade had become far more complex and
important than 40 years before
• The globalization of the world economy was underway
• Trade in services — not covered by GATT rules
• Ever increasing international investments

• Factors such as Unemployment, Crisis, Ineffective Trade
Laws, Poverty convinced GATT members that a new
effort to reinforce and extend the multilateral system
should be attempted.
• That effort resulted in the Uruguay Round, the

Marrakesh Declaration, and the creation of the WTO.
Rounds
Uruguay Round:
• 1986-1994
•123 countries participated
•Chaired by Arthur Dunkel

• The last and largest round of GATT which led the foundation of
GLOBAL VILLAGE
• It involved trade of GOODS, SERVICES,TECNOLOGY and TRIPs
• Agriculture was the key concern of round
• It was scheduled to be completed in 1990 which did not happened

due to lack of agreement between participating nations in areas
such as patents, maritime and agriculture.
• Initially it seemed that the purpose of round will fail but at the end
it brought the biggest reform in the worlds trading system.
• As the negotiation dragged on the DG of GATT Arthur Dunkel ,gave

a draft in December 1991 for solving the problem of deadlock
popularly known as “Dunkel Draft”.
• The round was finalized on 15 April 1994 and was signed by 117
nations out of 123.
“A round that made the World Flat”

GATT AND INDIA
• India was one of the 23 founding Contracting Parties to the General

Agreement on Tariffs and Trade (GATT) that was concluded in October
1947.
• India has often led groups of less developed countries in subsequent

rounds of Multilateral Trade Negotiations (MTNs) under the auspices of
the GATT.
GATT and Indian Pharma
Industry
• It was only after the GATT Trade

Rounds that Indian Drugs Industry
was allowed to patent its product.
•But the price of the patent was

very expensive.
•GATT strengthened India's

Pharma Sector.
•Improved Research Base.

GATT and India’s Agriculture
Sector
The main objective of the

GATT Treaty is to reform
world trade.
GATT and Indian Agri sector

is divided into 3 main phases
Market Access.
Domestic Support.
Export Competition.
Market Access.
In this all the GATT members were replace all the Trade Barriers and to
allow Indian Supplies into their country.
Tariffs reduced by 24% to 36%.
Domestic Support.
Develop countries also supported India to grow their Domestic

Consumption.
India has a big Domestic Market.
Export Competition.
Indian Agriculture industry has always been strong.
India used to Export to many developing and under developed countries.
India only had competition when it comes to Sales in Developed Countries.

Thank You…!!
Presented By
Anish Pillai 07
Brijesh Yadav 14
Jomy John 21
Pradeep Pillai 40
Punit Nair 41

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Gener al Ag r eement

on Tarif fs and Tr ade

• Was the outcome of the failure of negotiating

• The Bretton Woods Conference introduced the idea for

• As governments negotiated the ITO, 15 negotiating

• Once the ITO failed in 1950, only the GATT agreement

“Reduction of Barriers to International Trade”

• This was achieved through the Reduction of

– Subsidies on trade through a series of agreements

• Protection through tariff.

• Trade Negotiation among Developing Countries.

When did it all start….

• With Trade growth, production growth was

•Recognition of multilateral trading system as

• High rates of unemployment and constant factory closures led

• Both these changes undermined GATT’s credibility and effectiveness.

• The globalization of the world economy was underway

• Trade in services — not covered by GATT rules

• Ever increasing international investments

• That effort resulted in the Uruguay Round, the

•123 countries participated

•Chaired by Arthur Dunkel

• It involved trade of GOODS, SERVICES,TECNOLOGY and TRIPs

• Agriculture was the key concern of round

• It was scheduled to be completed in 1990 which did not happened

• As the negotiation dragged on the DG of GATT Arthur Dunkel ,gave

“A round that made the World Flat”

• India was one of the 23 founding Contracting Parties to the General

• India has often led groups of less developed countries in subsequent

• It was only after the GATT Trade

•But the price of the patent was

•GATT strengthened India's

•Improved Research Base.

The main objective of the

GATT and Indian Agri sector

Tariffs reduced by 24% to 36%.

Develop countries also supported India to grow their Domestic

India has a big Domestic Market.

Indian Agriculture industry has always been strong.

India used to Export to many developing and under developed countries.

India only had competition when it comes to Sales in Developed Countries.

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