UPSC Prelims Practice Questions — India and Mexico launch Negotiations for Preferential Trade Agreement, Sign Terms of Reference
Q1. With reference to rules of origin in international trade, consider the following statements: Which of the statements given above is/are correct?
- Rules of origin matter only for preferential trade; trade conducted on a most-favoured-nation basis requires no determination of origin.
- Under a preferential trade agreement, the concessional tariff applies only to goods that qualify as originating in the partner country, not to every good shipped from it.
- Under a 'change in tariff classification' test, a good is treated as originating in the country where processing shifts it into a different tariff heading.
- A. 1 and 3 only
- B. 1 and 2 only
- C. 1, 2 and 3
- D. 2 and 3 only
Q2. Under WTO disciplines, a measure is classified as a Sanitary and Phytosanitary (SPS) measure or a Technical Barrier to Trade (TBT) according to its purpose. Consider the following import requirements: Which of the above would fall under the SPS Agreement?
- A maximum residue limit for a pesticide in imported mangoes
- A mandatory crash-test specification for imported cars to protect occupants
- Mandatory fumigation of wooden packaging material to prevent the spread of plant pests
- A ban on poultry imports from a region reporting an avian influenza outbreak
- A. 1, 2, 3 and 4
- B. 1 and 3 only
- C. 1, 3 and 4 only
- D. 2 and 4 only
Q3. Consider the following statements: Which of the following is correct in respect of the above statements?
- Under WTO rules, a member may adopt a sanitary or phytosanitary measure that gives a higher level of protection than the relevant international standard.
- The WTO SPS Agreement exempts sanitary and phytosanitary measures from any requirement of scientific justification, provided they apply equally to domestic producers.
- A. Both Statement-I and Statement-II are correct and Statement-II explains Statement-I
- B. Both Statement-I and Statement-II are correct, but Statement-II does not explain Statement-I
- C. Statement-I is correct, but Statement-II is incorrect
- D. Statement-I is incorrect, but Statement-II is correct
Q4. With reference to trade agreements and the WTO framework, consider the following statements: Which of the statements given above is/are correct?
- A preferential trade agreement, by definition, must eliminate tariffs on substantially all trade between the partner countries.
- The WTO's Enabling Clause provides legal cover for preferential arrangements in trade in goods between developing country members.
- Regional agreements liberalising trade in services among WTO members are governed by Article XXIV of the GATT.
- A. 2 only
- B. 1 only
- C. 2 and 3 only
- D. 1 and 3 only
Q5. Consider the following statements: Which of the following is correct in respect of the above statements?
- Under WTO rules, a safeguard measure can be applied even to imports that involve no dumping or subsidisation.
- Under WTO rules, safeguard measures must be temporary.
- A. Both Statement-I and Statement-II are correct and Statement-II explains Statement-I
- B. Both Statement-I and Statement-II are correct, but Statement-II does not explain Statement-I
- C. Statement-I is correct, but Statement-II is incorrect
- D. Statement-I is incorrect, but Statement-II is correct
Q6. Consider the following facts: Mexico is a party to the USMCA along with the United States and Canada. India and Mexico have signed Terms of Reference to launch negotiations on a Preferential Trade Agreement that includes a rules-of-origin chapter. Mexico is not a member of Mercosur, with which India has a separate preferential trade agreement. Which of the following inferences can validly be drawn from the above?
- Tariff concessions India grants Mexico under the proposed agreement would not automatically extend to Mercosur members.
- With the signing of the Terms of Reference, Indian goods now enter Mexico at preferential rates of duty.
- Indian goods entering Mexico under the proposed agreement would automatically obtain preferential access to the United States under the USMCA.
- A. 1, 2 and 3
- B. 1 only
- C. 2 and 3 only
- D. 1 and 2 only