Duty-free quota-free (DFQF) scheme

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According to a report by the least developed countries Group at the World Trade Organisation (WTO), the Duty-free quota-free (DFQF) scheme remains unutilized by the LDC nations.

About the Duty-free quota-free (DFQF) scheme:

  • What it is? The decision to provide duty-free quota-free (DFQF) access for LDCs was first taken at the WTO Hong Kong Ministerial Meeting in 2005. 
  • India became the first developing country to extend this facility to LDCs in 2008, providing market access to 85 per cent of India’s total tariff lines
  • The scheme was expanded in 2014 providing preferential market access on about 98.2 per cent of India’s tariff lines to LDCs. 

Key facts about World Trade Organisation (WTO)

  • It was set up on 1st January 1995 and was born out of the 1986-94 Uruguay Round of Negotiations.
  • It is the only global international organization dealing with the rules of trade between nations.
  • It is the successor to the General Agreement on Tariffs and Trade (GATT)
  • The main function of the WTO is to ensure that trade flows as smoothly, predictably and freely as possible.
  • It further consists of two principles, the Most-favoured Nation (MFN) principle and the National treatment principle.
  • It is a 'member-driven' organisation, with decisions taken by consensus among the member governments.
  • Special and differential treatment to LDCs and developing countries in the form of special flexibilities and rights are specified in various WTO agreements and decisions.


Q1) What is Most-Favoured Nation?

It is a principle in international trade that involves treating all trading partners equally by providing the same trade advantages, privileges, and preferences to one country as those granted to any other country. It is a fundamental principle of the World Trade Organization

Source: WTO flags poor utilisation of India scheme for least developed countries