Q. Which one of the following statements is correct regarding the Generalized System of Preferences (GSP)?

[A] It is a reciprocal trade agreement providing tariff benefits to all World Trade Organization (WTO) member countries.

[B] It is a global free trade agreement enforced by the United Nations.

[C] It is a program under which developed countries grant preferential tariff treatment to eligible developing countries.

[D] It mandates that developing countries eliminate all tariffs on imports from developed nations.

Answer: C
Notes:

Explanation – The Generalized System of Preferences (GSP) is a trade program designed to promote economic growth in developing countries by providing preferential tariff treatment (such as reduced or duty-free tariffs) for certain goods exported to developed countries. It is a unilateral program, meaning developed countries voluntarily grant these benefits without requiring reciprocal trade concessions from the beneficiary developing countries.

Source: The Hindu

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