Chapter 17 · Topic 17.2 · Prelims + Mains2 of 3
International Organizations: WTO and EU
Key points
- GATT (1947) cut tariffs in rounds; the Uruguay Round (1986–94) created the WTO on 1 January 1995.
- The WTO added services (GATS), intellectual property (TRIPS) and farm trade; India defends food security and public stockholding.
- The EU grew from the ECSC (1951) and Treaty of Rome (1957) to Maastricht (1992) and the euro; the UK left on 31 January 2020.
1 PYQ 2007–2016
Prelims box: facts and traps
- WTO HQ: Geneva; 166 members.
- Doha Round: 2001, stalled on farm subsidies.
- Euro: 1999 for banks, 2002 notes and coins.
GATT and the WTO
Think of the WTO as the referee and rulebook for a big cricket league of countries. Everyone agrees on the rules, and when two teams fight, the referee decides. The EU is more like a joint family that pooled its money and opened every door in the house.
| Point | Detail |
|---|---|
| GATT (1947) | Tariff-cutting rounds; India a founding party |
| Uruguay Round (1986–94) | Created the WTO; added services (GATS), intellectual property (TRIPS), agriculture |
| WTO (1 January 1995) | Geneva; dispute settlement system; consensus decisions |
| Doha Round (2001) | ‘Development Round’, stalled over farm subsidies |
| India’s concerns | Food security, public stockholding, TRIPS and medicines |
The key words, explained
- Tariff: a tax on goods coming into a country. Lower tariffs mean cheaper imports and more trade.
- GATT: the General Agreement on Tariffs and Trade, a treaty, not an organisation. It cut tariffs through rounds of talks.
- Round: a long set of trade talks among all members, named after where it began, like Uruguay or Doha.
- GATS: rules for trade in services, such as banking, IT and telecom.
- TRIPS: rules protecting intellectual property: patents, copyrights and trademarks. India worries strict patents can make medicines costly.
- Dispute settlement: the WTO’s court-like system where countries bring trade complaints. Its top body, the Appellate Body, has been stuck since 2019 because the USA blocked new judges.
- Consensus: decisions need every member to agree, so one country can hold up a deal.
- Public stockholding: the government buying grain from farmers at fixed prices and storing it to feed the poor. India says this is vital for food security, while some members call it a trade-distorting subsidy.
The European Union
| Step | Detail |
|---|---|
| ECSC (1951) | Coal and steel pooling (Schuman Plan) |
| Treaty of Rome (1957) | European Economic Community, six members |
| Maastricht (1992) | European Union; path to the euro |
| Euro (1999/2002) | Single currency |
| Expansion | East European states joined from 2004 |
| Brexit | UK left on 31 January 2020 |
The idea was simple: if France and Germany shared coal and steel, the stuff of weapons, they could never go to war again. The six founders were France, West Germany, Italy, Belgium, the Netherlands and Luxembourg. The euro came in for banks in 1999 and as notes and coins in 2002. Brexit, short for “British exit”, followed a 2016 vote. The EU now has 27 members and is one of India’s biggest trading partners; the two concluded talks on a free trade agreement on 27 January 2026, which still needs signing and approval before it starts.
Common doubts
How many members does the WTO have? 166, covering almost all world trade.
Is the WTO part of the UN? No. It is a separate body, though it works closely with UN agencies.
Do all EU members use the euro? No. Some, such as Denmark, Sweden and Poland, keep their own currencies.
Why is the Doha Round stuck? Rich countries want poorer ones to open their markets, while poorer countries want rich ones to cut their large farm subsidies first. Neither side moves.
What does the EU’s single market mean? Goods, services, money and people move freely between member countries, as if they were one country.
What UPSC asks
Prelims: GATT 1947, Uruguay Round, WTO 1995, TRIPS, Treaty of Rome 1957, Maastricht 1992, Brexit 2020. Mains: India’s food-security fight at the WTO and lessons from European integration.
Mains box: analysis and answer points
- India at the WTO: food security, TRIPS and medicines.
- European integration: lessons and Brexit.
Practice
Prelims PYQs on this topic (1)
‘Doctors Without Borders (Medecins Sans Frontieres)’, often in the news, is
Answer (b) & explanation
MSF is an independent international NGO (b). Médecins Sans Frontières was founded in France in 1971 by doctors and journalists. It gives emergency medical care in wars, epidemics and disasters, and won the Nobel Peace Prize in 1999. It is not a division of the WHO (a), it is not run by the European Union (c), and it is not a UN specialised agency (d). In fact, it guards its independence by taking most of its money from private donors.
It was in the news in 2015 after a US airstrike hit its hospital in Kunduz, Afghanistan. Notice the trap: famous humanitarian names tempt you towards "UN" options, but bodies like MSF, Amnesty and the ICRC (a private Swiss association with a special mandate) are not UN agencies.
Answer as per the official UPSC answer key.
Write an answer
In 150 words, explain the significance of International Organizations with one recent example.
Flashcards (6)
GATT signed?
1947.
Round that created the WTO?
Uruguay Round.
WTO began?
1 January 1995.
Treaty of Rome?
1957, EEC.
Treaty creating the EU?
Maastricht (1992).
UK left the EU?
31 January 2020.
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