Q. Consider the following statements:
1.Investment facilitation for development (IFD) agreement under the WTO, aims to create legally binding provisions to facilitate investment flows.
2.Plurilateral agreement (PA) bind those WTO member countries that accept them and do not create rights or impose obligations on the remaining members.
3.Investor-State Dispute Settlement (ISDS) is a mechanism that allows host states to bring legal claims against foreign investors if they believe their investments are being treated unfairly or if their rights are being violated by the investor.
Which of the statements given above are correct?
Explanation –
Statements 1 and 2 are correct. Investment facilitation for development (IFD) under the World Trade Organization (WTO) is an initiative that aims to create legally binding provisions to facilitate investment flows, especially in developing countries. The agreement focuses on improving transparency, predictability, and efficiency in investment measures. A plurilateral agreement (PA) within the WTO is an agreement between a group of WTO member countries, not all members. Plurilateral agreements only bind those WTO member countries that accept them and do not create rights or impose obligations on the remaining members who have not accepted the agreement.
Statement 3 is incorrect. Investor-State Dispute Settlement (ISDS) is a mechanism that allows foreign investors to bring legal claims against host states if they believe their investments are being treated unfairly or if their rights are being violated by the host state. It is a legal provision commonly found in international investment agreements that grants investors the right to initiate arbitration proceedings against the host state. Currently, the process for resolving disputes at the WTO involves countries, not individual businesses.
Source: The Hindu
