Page 46 - Banking Finance October 2019

ARTICLE

d) Restriction on Imports: Commercial Services-
The developing countries are empowered or allowed to The developing countries' trade in commercial services, in
restrict imports on goods and services of a particular terms of both exports and imports grew at 9% & 8%
industry or sector for reasons of Balance of Payments (BoP) respectively at a faster rate than those of developed
difficulties. countries (7% for both) and the world (8% & 7%). The share
of developing countries' exports of global services was 30.9%
e) Waivers: of the world total exports of global services in year 2018,
Besides legal provisions stated explicitly in WTO agreements, which was highest ever recorded. Construction, travel,
any action taken in favor of developing countries, individually transport, telecommunication services and Goods related
or as a group, by General Council are treated under services were the key export sectors for many developing
"Waivers" from the main WTO rules/WTO Agreement. countries. While the share of imports of commercial services
by developing countries was 38.2% in year 2018.
Importance of Developing Country at
The developing countries in Asia were the main traders and
WTO: drivers of growth among developing countries, with their
The agreement establishing the World Trade Organization contribution reaching 20.8% of world total commercial
(WTO) also known as "WTO Agreement", which primarily services exports and 25.1% of world total commercial
cites about sustainable economic development as one of the services imports. Out of total trade in commercial services
objectives of the WTO, also specifies that international trade done by developing countries, the contribution of Asian
should benefit the economic development of developing and developing countries was highest at 67.20% in exports and
least developed countries. 65.61% in imports.

The developing countries, because their increasing numbers India as a Developing Country at WTO:
and increasing growth play a vital role in accelerating global
India has been a member of GATT since 8th July, 1948. India
economic development through trade. The participation and
became a member of WTO since its inception i.e.
contribution of developing countries in world trade, both in
goods and services have been increasing constantly and have 01stJanuary, 1995.
outperformed or equaled the performance of developed
economies in world trade over recent ten years. India has been the most dynamic developing country and
has been one of the leading traders in world trade. In last
Performance of Developing Countries in ten years, India has doubled its exports and has grown at
5.3% in merchandise exports and at 8.6% in commercial
Year 2018: services. With its constant improving performance, India has

Merchandise Trade- significantly moved up in its ranking among the world's
The developing countries' merchandise trade, in terms of leading exporters and importers. The increase in exports of
both exports and imports continued to rise in year 2018. transport equipment, chemicals and food products to North
Rather the growth rate of exports and imports of developing America and Asia contributed to move up India from 27th
countries (11% & 12%) was higher than those of developed position in 2008 to 19th position in the world rankings in
countries (9% both) and the whole world (10% both). The 2018. Likewise, India has also been moved up from 16th
developing countries had 43.5% & 41.1% share in world position in 2008 to 10th position in 2018 as a leading
exports and imports respectively. importer.

The Asian developing countries including India and China had In year 2018, India has also been leading trader of
28.1% and 27.1% share in world exports and imports commercial services. With rapid export growth in other
respectively. Out of total merchandise trade done by all business services for three consecutive years (around 9%)
developing countries, the contribution of Asian developing and in telecommunications, computer and information
countries was maximum at 64.62% in exports and 65.98% services (7%) boosted the country's performance and made
in imports. India the 8th largest exporter of commercial services. India

46 | 2019 | OCTOBER | BANKING FINANCE