Regional trading arrangements – reasons for popularity: Regional trading arrangements and FTAs have increasingly become the preferred mode of trade liberalization amongst the countries of a region even though they may be members of WTO. The reason for this can be traced to freedom that such arrangements provide for addressing the trade issues peculiar to a region or the member countries of an FTA.
In a nutshell FTAs/RTAs can be used as a tool for –
q Material management
q Cheaper imports – domestic prices in control
q Better quality products at competitive price
q Better market access
q Investments flow - JVs
q Coverage of Services
q Mutual recognition of standards & laboratories
q Trade facilitation, Harmonisation of Customs procedures etc.
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