International Economic & Financial Organizations: A Digital Explorer

Introduction to IEFOs

International Economic and Financial Organizations (IEFOs) form the bedrock of global economic governance, facilitating trade, promoting financial stability, and fostering development. Established largely in the aftermath of World War II, notably through the Bretton Woods Conference, these institutions like the IMF and World Bank (collectively, the Bretton Woods Institutions) and later the WTO (evolved from GATT) have profoundly shaped the global economic order.

Alongside these, various regional and plurilateral groupings like the G7, G20, BRICS, and development banks play crucial roles in coordinating economic policies and addressing global challenges. Understanding their objectives, functions, challenges, and India's engagement is vital for comprehending contemporary international political economy.

2.2.1: Bretton Woods Institutions

The Bretton Woods Conference, held in Bretton Woods, New Hampshire, USA, in July 1944, established the framework for post-WWII international economic cooperation.

1. International Monetary Fund (IMF)

Objectives:

Promote international monetary cooperation.
Facilitate the expansion and balanced growth of international trade.
Promote exchange rate stability.
Assist in the establishment of a multilateral system of payments.
Make resources available (with adequate safeguards) to members experiencing balance of payments difficulties.
Shorten the duration and lessen the degree of disequilibrium in the international balance of payments of members.

Functions:

Surveillance: Monitors global economic developments and member countries' policies (World Economic Outlook - WEO, Global Financial Stability Report - GFSR).
Lending: Financial assistance for Balance of Payments (BoP) problems, conditional on policy reforms (often criticized as "IMF conditionalities").
Technical Assistance and Training: Helps members build institutional capacity (fiscal, monetary, financial regulation).

Key IMF Instruments

SDRs (Special Drawing Rights):

Definition: An international reserve asset created by the IMF in 1969 to supplement member countries’ official reserves. It is not a currency.
Purpose: Can be exchanged for freely usable currencies. Acts as a unit of account for the IMF and other international organizations.
Valuation: Based on a basket of five major currencies: US dollar, euro, Chinese renminbi (added 2016), Japanese yen, and British pound.

Quotas:

Definition: Each member country is assigned a quota, broadly based on its relative position in the world economy.
Role: Determines the country's financial contribution to the IMF, its voting power, and its access to IMF financing.
Review: Quotas are reviewed every five years, but reforms are often slow due to political complexities.

India's Engagement and Reforms:

Founding Member: India is a founding member of the IMF.
Historically a Borrower: India was a significant borrower during BoP crises (e.g., 1991).
Now a Contributor: India is no longer a borrower and has become a net creditor to the IMF.
Reform Stance: India consistently advocates for comprehensive quota reforms to reflect the growing economic weight of emerging market and developing economies (EMDEs), aiming for more equitable representation.

2. World Bank Group

Composition (Five Institutions):

IBRD

Provides loans, credits, and grants to middle-income and creditworthy low-income countries.

IDA

Provides interest-free loans (credits) and grants to the world’s poorest countries. "Soft loan window."

IFC

Focuses on the private sector in developing countries, providing investment, advisory services.

MIGA

Provides political risk insurance (guarantees) to encourage foreign direct investment.

ICSID

International facilities for conciliation and arbitration of investment disputes. (India is not a member).

Objectives:

Poverty reduction.
Promoting sustainable development and shared prosperity.
Providing financial and technical assistance to developing countries.

Functions:

Lending: Financing for development projects (infrastructure, health, education).
Technical Assistance & Policy Advice: Expert advice and capacity-building.
Knowledge Production: Influential research, data, and reports (e.g., Human Capital Index, World Development Report).

India's Relationship (Largest Borrower Historically):

Historical Largest Borrower: India has historically been the largest single borrower from the World Bank Group.
Shift to Knowledge Partnership: As India's economy has grown, its relationship has evolved to a strategic partnership, including policy advice, technical assistance, and sharing India's development experience with other countries (South-South cooperation). India also contributes to IDA.

2.2.2: World Trade Organization (WTO)

Evolution from GATT

1948: GATT (General Agreement on Tariffs and Trade)

Established as a provisional agreement aimed at reducing tariffs and other trade barriers. It was a multilateral treaty, not an organization.

1986-1994: Uruguay Round

The last and most comprehensive GATT round, which led to the creation of the WTO.

1995: Creation of the WTO

Transformed GATT into a full-fledged international organization, expanding its scope to services and intellectual property.

Principles

MFN (Most-Favored Nation) (Article I): Treat all other WTO members equally (i.e., grant them the best trade terms offered to any other trading partner). Exceptions exist (e.g., regional trade agreements, GSP).
National Treatment (Article III): Imported and locally produced goods should be treated equally once they enter the market (e.g., no higher taxes for imports).
Non-Discrimination: Encompasses both MFN and National Treatment.
Predictability: Through binding tariffs and transparent rules.
Reciprocity: Mutual lowering of trade barriers.
Transparency: Openness in trade policies and regulations.

Structure

Ministerial Conference

The highest decision-making body, usually meets every two years.

General Council

Oversees day-to-day operations and acts as the DSB (Dispute Settlement Body) and TPRB (Trade Policy Review Body).

Dispute Settlement Body (DSB)

Oversees the settlement of trade disputes between members. It has panels that hear cases and issue rulings.

Appellate Body

A standing body of seven persons that hears appeals from reports issued by panels in disputes between WTO members. Currently facing a crisis.

Key Agreements (Result of Uruguay Round)

TRIPS (Trade-Related Aspects of Intellectual Property Rights)

Sets minimum standards for intellectual property protection (patents, copyrights, trademarks).

TRIMS (Trade-Related Investment Measures)

Prohibits certain investment measures that restrict trade (e.g., local content requirements, export performance requirements).

GATS (General Agreement on Trade in Services)

Extends multilateral trading rules to services (e.g., banking, telecom, tourism).

AoA (Agreement on Agriculture)

Aims to reform trade in agriculture, reducing domestic support (subsidies), export subsidies, and improving market access. Key subsidy categories:

Green Box: Minimal distortion to trade (e.g., environmental programs, research) – permitted.
Blue Box: Direct payments to farmers that limit production – permitted.
Amber Box: Trade-distorting subsidies (e.g., price supports, input subsidies) – subject to reduction commitments.

NAMA (Non-Agricultural Market Access)

Deals with reducing tariffs and non-tariff barriers for industrial products.

Doha Development Round

Launched 2001, effectively stalled since 2008. Aimed at further liberalization of trade, with a strong focus on development issues for developing countries.

Key Areas of Contention:

Agriculture: Deep divisions on reduction of subsidies by developed countries and market access for developing countries.
NFF (Non-Farm products): Tariffs on industrial goods.
Services: Further liberalization commitments.
Special and Differential Treatment (S&DT): How to ensure developing countries receive flexible rules and support.

Stalemate: Primarily due to persistent disagreements between developed and developing countries, particularly on agriculture subsidies and market access, as well as new issues like intellectual property and investment.

Challenges & India's Stand

Challenges:

Appellate Body Crisis: US blocking appointment of new members, paralyzing dispute settlement.
Fisheries Subsidies: Long-running negotiations to curb harmful subsidies. Partial agreement at MC12, needs full ratification.
Digital Trade/E-commerce: Lack of global rules for rapidly growing digital trade.
Trade Protectionism/Unilateralism: Rise of nationalistic policies, bilateral agreements, use of trade as a geopolitical weapon.

India's Stand:

Food Security: Advocates for a permanent solution to public stockholding.
Special & Differential Treatment (S&DT): Emphasizes the need for S&DT for developing countries.
Opposition to Non-Tariff Barriers: Pushes back against stringent SPS/TBT measures.
Multilateralism: Committed to a rules-based system despite challenges.
MC13 (Abu Dhabi, Feb 2024): Failed to reach consensus on key issues, highlighting challenges.

2.2.3: Other Major Economic Groupings

G7

Members: Canada, France, Germany, Italy, Japan, United Kingdom, United States (and the European Union as a non-enumerated member).

Objectives: Informal forum of leading industrialized democracies that coordinate on global economic, financial, and political issues.

Evolution: Began as G6 in 1975; Canada joined in 1976. Russia was G8 (1998-2014) but suspended.

OECD

Role: Intergovernmental economic organization to stimulate economic progress and world trade. Often called a "think tank" or "policy laboratory" for developed countries.

Membership: Composed mainly of high-income economies, committed to democracy and market economy.

India's Relationship: India is a key partner, but not a full member. Participates in various committees and initiatives (e.g., PISA, BEPS).

Asian Development Bank (ADB)

Purpose: Poverty reduction and promoting economic growth and cooperation in Asia and the Pacific.

Headquarters: Manila, Philippines.

India is a founding member and major borrower.

G20: Premier Forum for Global Economic Cooperation

Members: 19 countries (including India) plus the European Union and, as of 2023, the African Union.

Objectives: Premier forum for international economic cooperation, bringing together systematically important industrialized and developing economies to address global economic challenges.

Evolution: Formed in 1999 as Finance Ministers and Central Bank Governors meeting. Elevated to Leaders' Summit level in 2008 in response to the global financial crisis.

Represents about 85% of global GDP, over 75% of global trade, and about two-thirds of the world population.

India's G20 Presidency (2023):

Theme: "Vasudhaiva Kutumbakam" (One Earth, One Family, One Future).
Key Outcomes of New Delhi Leaders' Declaration (Sept 2023):
- African Union (AU) permanent membership: Historic step for inclusivity.
- Digital Public Infrastructure (DPI): Emphasis on open-source, interoperable DPI (e.g., India's Aadhar, UPI).
- Green Development Pact: Strong commitment to climate action, climate finance (tripling renewable energy capacity by 2030).
- Reform of Multilateral Development Banks (MDBs): Call for MDBs to be more effective.
- Consensus on Russia-Ukraine War: Achieved a pragmatic consensus statement.
Significance: India successfully navigated complex geopolitical divisions, demonstrated leadership, and championed the voice of the Global South.

BRICS

Members: Brazil, Russia, India, China, South Africa.

Objectives: A bloc of major emerging economies aimed at fostering cooperation, promoting development, and advocating for a more multipolar world order that challenges the Western-centric global economic architecture.

New Development Bank (NDB):

Establishment: Launched by BRICS in 2014, fully operational 2015.
Purpose: Mobilize resources for infrastructure and sustainable development projects in BRICS and other emerging economies.
Alternative: Seen as an alternative to the World Bank and IMF, offering loans without traditional Western conditionalities.
Headquarters: Shanghai, China.

Contingent Reserve Arrangement (CRA):

Purpose: A framework for providing liquidity support through currency swaps to BRICS members in times of balance of payments crises.
Alternative: Serves as a financial safety net, complementing existing international arrangements like the IMF.

Expansion:

Recent Development (Jan 2024): BRICS officially expanded to include Egypt, Ethiopia, Iran, Saudi Arabia, and UAE. Argentina, initially invited, declined. This significantly increases the bloc's global economic and geopolitical weight.

Other Development Banks

Asian Infrastructure Investment Bank (AIIB):

Establishment: China-led multilateral development bank, launched 2016.
Purpose: Support the building of infrastructure in the Asia-Pacific region.
Alternative: Seen as a competitor or complement to the ADB and World Bank.
India's Relationship: India is the second-largest shareholder (after China) and the largest borrower from AIIB.

Note on ADB:

The Asian Development Bank (ADB), headquartered in Manila, Philippines, also plays a crucial role in Asia-Pacific development. India is a founding member and major borrower from ADB as well, demonstrating its multi-faceted engagement with regional development finance.

Prelims-ready Notes

Organization/Grouping	Key Features/Facts	India's Engagement
IMF	Monetary cooperation, BoP support, SDRs (5 currencies), Quotas. WEO, GFSR.	Founding member, now net contributor, advocates for quota reform.
World Bank Group	5 institutions (IBRD, IDA, IFC, MIGA, ICSID). Poverty reduction, sustainable dev.	Historically largest borrower, now knowledge partner, IDA contributor.
WTO	GATT->WTO (1995, Uruguay Round). MFN, National Treatment, DSB. TRIPS, AoA (boxes).	Advocate for food security (public stockholding), S&DT, multilateralism.
G7	Canada, France, Germany, Italy, Japan, UK, US (+EU). Industrialized economies.	Not a member.
G20	19 countries + EU + AU. Premier forum for global economic cooperation.	Hosted 2023 Presidency (AU permanent member, DPI, Green Dev Pact).
OECD	"Rich countries' club," policy advice.	Key partner, not a member.
BRICS	Brazil, Russia, India, China, South Africa (+ new members). NDB, CRA.	Founding member, NDB & CRA participant, advocates expansion.
ADB	Asia-Pacific development. H.Q.: Manila.	Founding member and major borrower.
AIIB	China-led, infrastructure. H.Q.: Beijing.	2nd largest shareholder, largest borrower.

Mains-ready Analytical Notes

The Bretton Woods Institutions: Adaptation vs. Obsolescence in the 21st Century

Argument for Adaptation/Relevance: IMF and World Bank have evolved mandates (e.g., poverty reduction focus, climate finance, human capital). They provide essential global public goods like financial stability and development funding, especially for LICs. Their data and technical expertise remain valuable. IMF's role in global financial crises (e.g., 2008) and WB's role in pandemic response (e.g., COVID-19 vaccine financing) demonstrate adaptability.

Argument for Obsolescence/Critiques:

Governance Deficit: Reflect outdated power structures (IMF quotas, WB presidency always US national), leading to calls for reform from EMDEs.
Conditionalities: IMF lending conditionalities are often criticized for imposing harsh austerity measures.
Development Models: WB's development models are sometimes seen as promoting a Western, market-centric approach.
Rise of Alternatives: Emergence of BRICS NDB, AIIB, and bilateral lending (e.g., China's Belt and Road Initiative) offer alternatives.

India's Stance: India, while a beneficiary, actively champions their reform, particularly in governance and representation, to reflect the multipolar economic reality.

The Crisis of the WTO: Threats to the Multilateral Trading System

Nature of the Crisis: The paralysis of the Appellate Body due to US blocking of appointments (since 2019) is the most critical challenge, effectively undermining the WTO's dispute settlement mechanism.

Contributing Factors:

Doha Round Stalemate: Inability to conclude multilateral trade negotiations (especially on agriculture, new issues).
Rise of Protectionism/Economic Nationalism: Governments increasingly prioritize domestic industries, use trade as a weapon.
New Issues: WTO struggles to adapt to 21st-century issues like digital trade, e-commerce.
China's Role: Concerns by developed countries about China's state-led capitalism.

Implications: Increased trade disputes, fragmentation of global trade rules, potential for trade wars.

India's Stand: India remains a staunch advocate for a rules-based multilateral trading system but also strongly defends its national interests on issues like food security (public stockholding) and special and differential treatment.

G20's Evolving Role in Global Economic Governance and India's Leadership

Evolution: From a finance ministers' forum to the premier platform for global economic cooperation post-2008 crisis.

Strengths: Inclusivity (systemically important developed and developing economies), flexibility, capacity to address broad range of issues.

Challenges:

Geopolitical Divides: Russia-Ukraine war exposed deep divisions, hindering consensus.
Implementation Gap: Agreements often non-binding.

India's G20 Presidency (2023):

Significance: Demonstrated India's rising diplomatic clout and ability to bridge divides. Inclusion of AU was a historic win.
Outcomes: Successfully navigated tensions to produce a consensus Leaders' Declaration. Focus on inclusive growth, climate finance, DPI, MDB reforms.
Future Role: Strengthens India's position as a voice for the Global South and a bridge-builder.

BRICS and the Challenge to the Bretton Woods Order

Objective: BRICS represents the growing economic and political power of emerging economies, aiming to promote cooperation and challenge the Western-centric global financial and economic architecture.

NDB and CRA as Alternatives:

NDB: Offers an alternative source of financing for infrastructure and sustainable development, with less conditionalities.
CRA: Provides a liquidity safety net for members, aiming to reduce reliance on IMF.

Expansion (Jan 2024): Inclusion of new members (Egypt, Ethiopia, Iran, Saudi Arabia, UAE) signifies BRICS' growing influence and ambition to represent a larger share of the global economy and population, potentially increasing its collective leverage.

Critiques/Challenges: Internal divisions, lack of a unified political vision, and integration challenges for new members. BRICS countries also continue to engage with BWIs.

Current Affairs & Recent Developments

India's G20 Presidency (2023)

Culminated in the successful New Delhi Leaders' Summit in September 2023.
Key achievements: African Union (AU) becoming a permanent member of the G20, a consensus declaration despite geopolitical tensions (Russia-Ukraine war), and emphasis on Digital Public Infrastructure (DPI), Green Development Pact, and MDB reforms.
Significantly boosted India's diplomatic profile.

BRICS Expansion (Jan 2024)

Formal inclusion of Egypt, Ethiopia, Iran, Saudi Arabia, and UAE from January 1, 2024.
Significantly expands BRICS' geographical reach and economic weight, especially in energy.
Seen as strengthening the bloc's aspirations to create a more multipolar global order and potentially reduce reliance on the US dollar.

WTO MC13 (Feb 2024, Abu Dhabi)

Despite intense negotiations, members failed to reach a consensus on major issues like agriculture (permanent solution for public stockholding) and fisheries subsidies.
Highlights the continued paralysis within the WTO's negotiating function and deepening divisions.
Further exacerbates the existing Appellate Body crisis.

World Bank & IMF Reforms

Ongoing discussions to reform Multilateral Development Banks (MDBs) to better address global challenges like climate change, pandemics.
G20 under India's presidency specifically called for this.
IMF's 16th General Review of Quotas is underway, but significant shifts in voting shares to reflect EMDEs' economic weight remain elusive.

UPSC Previous Year Questions (PYQs)

Prelims MCQs

(2023) In the context of finance, the term 'credit default swap' (CDS) is related to which of the following?

(a) Borrowing from IMF

(b) Hedging against default risk

(d) Lending to governments

Answer: (b) and (c)
Explanation: CDS is a financial derivative used to hedge against the credit risk of a debt instrument. While (b) identifies its primary purpose, (c) describes its nature. Often, such questions can have more than one technically correct answer if the options are broad. However, the most direct and specific answer relating to its purpose is (b).

(2022) With reference to the 'Special Drawing Rights (SDRs)', which of the following statements are correct?

1. SDRs are created by the International Monetary Fund (IMF).

2. SDRs are represented by a basket of currencies comprising the U.S. dollar, Japanese yen, Euro, Chinese Yuan (RMB) and the British Pound.

3. SDRs can be used to settle international financial transactions among commercial banks.

Select the correct answer using the code given below:

(a) 1 and 2 only

(b) 2 and 3 only

(d) 1, 2 and 3

Answer: (a)
Explanation: SDRs are an international reserve asset, not a currency, and are primarily used by central banks and the IMF, not for commercial bank transactions.

(2018) 'Doha Development Round' of the WTO talks stalled due to differences between:

(a) Developed and Developing Countries

(b) Developed and Least Developed Countries

(d) Major trading blocs (e.g., EU and NAFTA)

Answer: (a)
Explanation: The core impasse in Doha was the persistent disagreement over agricultural subsidies and market access between the developed world and developing countries, particularly on the special and differential treatment for the latter.

Mains Questions

(2022) "The WTO is often criticized for its slow pace of decision-making and its inability to effectively address contemporary global trade challenges." Critically evaluate this statement, suggesting reforms to enhance its relevance. (15 Marks)

Direction: Acknowledge the criticism, elaborate on reasons (consensus-based decision-making, Doha stalemate, Appellate Body crisis, new issues like digital trade). Discuss specific contemporary challenges (protectionism, climate concerns, supply chain resilience). Suggest reforms: Appellate Body revival, new negotiation approaches (plurilateral agreements), addressing digital trade, special and differential treatment, review of consensus requirement.

(2021) Critically examine the objectives of the World Bank Group and its evolution in addressing the needs of developing countries. (15 Marks)

Direction: Outline the initial objectives (post-war reconstruction, development loans). Discuss evolution: shift to poverty reduction (IDA), engagement with private sector (IFC, MIGA), knowledge and policy advice. Examine its role in specific areas (health, education, climate). Critically analyze its effectiveness, conditionalities, and need for reform in a changing global landscape. Mention India's journey as a borrower and partner.

(2020) "The G20 has emerged as a crucial forum for global economic governance, but its effectiveness is often constrained by internal divisions." Discuss this statement with suitable examples. (15 Marks)

Direction: Explain G20's rise (post-2008 crisis), its broad agenda (finance, development, climate, health). Discuss its strengths (inclusive, informal). Then, highlight constraints: internal divisions (e.g., US-China trade tensions, Russia-Ukraine war impacting consensus on energy/finance), lack of legally binding decisions, implementation gap, representational issues (though AU added). Provide examples of both successes (2008 crisis response) and limitations (recent summits on geopolitical issues).

Trend Analysis (UPSC Questioning)

UPSC's questioning on IEFOs has consistently been a significant component, demonstrating a shift from purely factual recall to a more analytical, contemporary, and India-centric approach.

Prelims:

Earlier: Often direct questions on headquarters, year of establishment, or basic functions.
Current Trend: Questions are increasingly conceptual, focusing on key principles (MFN, National Treatment), specific instruments (SDRs, types of subsidies), and ongoing challenges (Appellate Body crisis, Doha Round). Strong emphasis on current affairs and India's active role.

Mains:

Earlier: Might have asked for a general description of an organization's functions.
Current Trend: Demands critical evaluation and in-depth analysis. Candidates are expected to assess effectiveness, analyze debates, discuss reform proposals, integrate India's perspective, and connect to Current Affairs.

Overall, UPSC seeks candidates who can demonstrate a nuanced understanding of global economic governance, its complexities, and India's strategic engagement within this framework.

Original MCQs for Prelims

1. Which of the following statements about the New Development Bank (NDB) is/are correct?

1. It was established by the BRICS countries.
2. It primarily focuses on providing liquidity support for balance of payments crises.
3. Its headquarters are located in New Delhi, India.

Select the correct answer using the code given below:

(a) 1 only
(b) 1 and 2 only
(c) 2 and 3 only
(d) 1, 2 and 3

2. The "Green Box" subsidies, as defined under the WTO's Agreement on Agriculture (AoA), are characterized by:

(a) Being directly linked to the volume of production and distorting trade.
(b) Involving direct payments to farmers with limits on production.
(c) Having a minimal or no impact on trade distortion, such as environmental programs or research.
(d) Being prohibited forms of agricultural support under WTO rules.

Original Descriptive Questions for Mains

1. "The rise of new economic groupings and development banks, such as BRICS and AIIB, indicates a significant shift in the landscape of global economic governance, challenging the traditional dominance of the Bretton Woods Institutions." Discuss this statement with appropriate examples, also highlighting the implications for India's foreign economic policy. (15 Marks)

Key Points/Structure:

Introduction: Briefly introduce the traditional dominance of BWIs and the emergence of new institutions like BRICS and AIIB. State the premise of a shift in global economic governance.

Challenge to Traditional Dominance:

Governance Deficit of BWIs: Critiques of outdated voting shares, conditionalities, and Western-centric approaches.
Alternative Financing: NDB (infrastructure, sustainable development) and AIIB (Asian infrastructure) offering new avenues for funding, often with different conditionalities.
Challenge to US Dollar Hegemony: BRICS' CRA and ongoing discussions about de-dollarization (though nascent) as alternatives to IMF.
Voice of the Global South: These new groupings provide platforms for emerging economies to assert their collective interests.

Implications for India's Foreign Economic Policy:

Strategic Autonomy: Opportunity to diversify financial partners, reducing over-reliance on BWIs.
South-South Cooperation: Strengthened solidarity and cooperation with other emerging economies.
Leverage for Reforms: India can use its participation in BRICS/AIIB to press for faster reforms within BWIs.
Development Financing: Access to additional, less conditional financing for its massive needs (India as largest borrower from AIIB).
Navigating Rivalries: Balancing engagement with both traditional (WB, IMF) and new institutions (NDB, AIIB) amidst geopolitical competition.

Conclusion: The emergence of new institutions indeed signals a more multipolar and polycentric global economic order. While they complement existing structures, they also provide a significant challenge, requiring BWIs to adapt and reform. India's ability to strategically engage with both sets of institutions will be key.

2. Examine the evolution of the World Trade Organization (WTO) from GATT, identifying its core principles and major agreements. Critically analyze the contemporary challenges facing the WTO, particularly the Appellate Body crisis, and India's stand on these issues. (20 Marks)

Key Points/Structure:

Introduction: Briefly introduce GATT and its evolution into WTO in 1995 as the foundation of the rules-based multilateral trading system.

Evolution and Core Principles:

From GATT to WTO: Explain the transition from a provisional agreement to a full-fledged international organization with a broader mandate and stronger dispute settlement.
Core Principles: Explain MFN, National Treatment, Non-Discrimination, Predictability, Reciprocity, Transparency.
Major Agreements: Briefly mention TRIPS, TRIMS, GATS, AoA (with boxes), NAMA and their significance.

Contemporary Challenges:

Appellate Body Crisis: Detail the US blocking of appointments, reasons, and severe implications for DSB.
Doha Round Stalemate: Explain reasons for failure (agriculture, NFF, S&DT).
Rise of Protectionism/Unilateralism: Examples of trade wars, tariffs, bilateralism vs. multilateralism.
New Issues: Difficulty in forging consensus on digital trade, e-commerce, environmental standards.
Geopolitical Divides: WTO becoming a battleground for broader geopolitical rivalries.
Ineffectiveness: Perceived inability to adapt quickly to global supply chain shocks.

India's Stand:

Pro-Multilateralism: Supports a rules-based multilateral trading system.
Food Security: Strong demand for a permanent solution on public stockholding.
Special & Differential Treatment: Insists on flexibility and support for developing countries.
Opposition to Non-Tariff Barriers: Pushes back against protectionist measures.
WTO Reform: Advocates for reforms to make it more inclusive and effective.

Conclusion: The WTO is at a critical juncture. Its relevance hinges on its ability to overcome the Appellate Body crisis, conclude negotiations, and adapt to 21st-century trade. India, as a major developing economy, has a crucial role to play.