Most Favored Nation (MFN) Treatment for India An Analysis

Abstract

[While MFN treatment is one of the basic principles of the multilateral trading system under GATT/WTO, exceptions are there and have been exercised by countries considering their own objectives and interests.  While India granted Pakistan MFN status since 1996, trade balance remains heavily in favor of India due to Non-Tariff Barriers (NTBs) imposed by India. Considering the nature of relationship between the two countries and state of affairs of Pakistani economy, MFN status will have some worth pondering pitfalls for Pakistan, and only meager gains are expected. Moreover, the hasty decision to grant MFN status to India seems driven more by international agenda than any indigenous imperative. Pakistan needs to adopt a gradual approach and should go for complete liberalization of trade only after guarantees for removal of NTBs and its rightful share of water. – Author.]