The WTO, which began operation in 1995, is an improvement over GATT, i.e., General Agreement on Tariff and Trade. GATT was a forum where members met occasionally to solve world trade problems whereas WTO is a chartered trade organization based in Geneva, Switzerland.
The WTO has a legal status and enjoys privileges that are same as the IMF and the World Bank. There were 76 Governments which became members of the WTO on its first day and by 1996 this number increased to 145. India is one of the founder members of WTO. At present the number has gone upto (147) including Chaina.
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The main function of WTO are:
(1) To act as a main body to promote multilateral trace system.
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(2) Cooperative with other international bodies in the matters of international trade.
(3) To control harmful and unfair trade practices.
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(4) To promote barrier free trade.
(5) To mediate trade disputes among nations.
(6) Undertake action and suggest measures for smooth flow of trade.
The WTO is headed by the Director General but major decisions are taken at the Ministerial conference, which meets at least once in every two years in order to work for establishing greater coherence at the global level of economic policy making.
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The last Ministerial conference was held at Cancan which was inconclusive in the decision making on implementation of various issues. There is a General Council that is composed of all the members to monitor the operations of the WTO Agreement and the ministerial decisions on a regular basis.
Trade and Commerce Ministers of member countries attend the General Council meet. The WTO Dispute Settlement Body (DSB) and a Trade Policy Review Body (TPRB) each of which has its own Chairman.
There may be many more councils of the WTO and the General Council heads all of these and they can have their own subsidiary bodies. The Director General, who is appointed by the ministerial conference, heads the secretariat of the WTO.
The Doha Ministerial Summit in 2002 made many important decisions which were favourable for fostering a better understanding in the world trade system. The next ministerial meets and other meetings will have to consider the decisions of Doha meet which succeed in post ponning three Singapore issues investment, Competition policy and transparency in government procurement. For the time being the three issues are out of the WTO agenda.