World Trade Organization and the Indian Economy: An Analytical Perspective on Globalization

Abstract

The global economy has undergone a profound transformation marked by accelerated globalization, driven primarily by transnational economic integration through trade, investment flows, and the strategic operations of multinational corporations. The twin forces of privatization in many market-oriented economies and the liberalization of trade and investment—initially under the General Agreement on Tariffs and Trade (GATT) and subsequently institutionalized through the World Trade Organization (WTO)—have significantly intensified the momentum of globalization. Since the late 20th century, the world has witnessed widespread economic liberalization, making globalization an increasingly irreversible phenomenon. The global economy has evolved into a complex, interdependent, and transnational system characterized by diminishing trade barriers and the enhanced mobility of goods, services, and capital. Cross-border trade and investment have consistently outpaced the growth of global output, indicating a deepening integration of national economies within a unified global framework. Developing countries are increasingly aligning with the economic structures of advanced economies, participating more actively in global trade networks. In the Indian context, the WTO has played a pivotal role in shaping the country’s engagement with the global economy. As a WTO member, India enjoys Most-Favoured-Nation (MFN) status in its trade relations with all other member countries. The WTO's influence has been instrumental in embedding globalization trends within India’s economic framework, catalyzing a significant economic transformation and ushering in a new era of global connectivity and competitiveness.