New Delhi: The Union Ministry of Commerce and Industry has informed Parliament that there is no proposal to withdraw the Most Favoured Nation (MFN) status of China.
“No such proposal is under consideration at this time,” said Commerce and Industry Minister Piyush Goyal Monday, while replying to a question on whether the government was planning the withdrawal of MFN status to China in order to reduce export-import with the neighbouring country.
Goyal’s reply came even as a 14-hour meeting between India and China Monday failed to break the logjam over the situation in eastern Ladakh. Senior military and diplomatic officers from both sides will have more rounds of negotiations on the border situation.
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What is Most Favoured Nation status
Under Article 1 of the General Agreement on Tariffs and Trade (GATT), 1994, every World Trade Organisation (WTO) member country is required to accord a MFN status, or preferential trade terms with respect to tariffs and trade barriers, to all other member nations.
The principle of MFN essentially means that if one country is granted trade concessions, all other WTO nations must also be given the same favour.
However, Article XXI (b) (iii) of the GATT also allows a WTO member to take action or impose restrictions “which it considers necessary for the protection of its essential security interests taken in time of war or other emergency in international relations”.
India had last year revoked the MFN status of Pakistan in the aftermath of the Pulwama terror attack.
In a separate reply Monday, the Ministry of Commerce and Industry had also informed Parliament that India’s imports from China have declined by 27.63 per cent between April and August this fiscal over the same period last year.
Value of imports from China stood at $5.58 billion in July and $4.98 billion in August, according to data provided by Goyal.
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