SSC
The General Agreement on Tariffs and Trade (GATT) came into force in:
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Answer: Option C — 1948
Detailed Solution
The General Agreement on Tariffs and Trade (GATT) was signed by 23 countries in Geneva on 30 October 1947, and it came into force on 1 January 1948.
About GATT:
It was a multilateral agreement aimed at reducing tariffs (import duties) and other barriers to international trade, and at eliminating discrimination in trade.
It was meant to be part of a larger organisation, the "International Trade Organization" (ITO), proposed at the Havana Conference (1947-48). However, the ITO never came into existence, because the US Congress did not approve it. GATT therefore served as the main framework for world trade for almost 50 years.
India was one of the 23 original signatories of GATT.
Its main principles:
- "Most Favoured Nation" (MFN) treatment: a member must give all other members the same trade advantages that it gives to any one country.
- "National Treatment": imported goods must be treated the same as locally produced goods once they enter the market.
- Reduction of tariffs through negotiations.
GATT negotiating rounds:
- GATT held eight rounds of trade negotiations.
- Early rounds (such as Geneva 1947, Annecy 1949, Torquay 1951) focused on reducing tariffs.
- The Kennedy Round (1964-67) and the Tokyo Round (1973-79) dealt with tariffs and non-tariff barriers.
The Uruguay Round (1986-1994), the eighth and last round, was the most ambitious. It covered agriculture, services, intellectual property and textiles, and it created the World Trade Organization (WTO).
The WTO replaced GATT as an organisation on 1 January 1995. However, the GATT rules (updated as "GATT 1994") still form part of the WTO agreements on trade in goods.
Arthur Dunkel, the Director-General of GATT, prepared the "Dunkel Draft" (1991), which became the basis of the Uruguay Round agreements.
Other international economic institutions:
- The Bretton Woods Conference (July 1944, USA) created the International Monetary Fund (IMF) and the International Bank for Reconstruction and Development (IBRD, part of the World Bank).
- GATT, the IMF and the World Bank together were meant to form the basis of the post-war world economic order.
Why not the other options?
- ✗1944 is the year of the Bretton Woods Conference.
- ✗1995 is the year the WTO replaced GATT.
- ✗1960 is the year OPEC was founded.
Quick tip
Remember: GATT = signed 30 October 1947 by 23 countries (including India), in force 1 January 1948; eight rounds; Uruguay Round (1986-94) created the WTO (1 January 1995); Bretton Woods (1944) = IMF and World Bank.
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International Economic Organisations — Preparation
This question tests your understanding of International Economic Organisations, a key topic in the General Knowledge section. The detailed solution above uses a step-by-step approach to show the reasoning, and where available, a shortcut that helps you solve similar questions in under 90 seconds during the actual exam.
This topic covers international economic and financial organisations: the IMF, the World Bank group, the WTO, the Asian Development Bank, the New Development Bank, the AIIB, OPEC, the OECD and groupings such as the G20, along with their headquarters, founding and functions. Questions usually ask where an organisation is headquartered, when it was set up, and what it does. For example, the IMF and World Bank were created at the Bretton Woods Conference in 1944, the WTO replaced GATT in 1995, and the New Development Bank, set up by the BRICS countries, is headquartered in Shanghai. Practise the international economic organisations questions below, written in the style of the general awareness sections of exams such as SSC, banking, railways, CUET GAT, MAH CET and CLAT. Each question comes with a detailed explanation that adds related facts, so every question helps you revise more than one point.