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Question

Which among the following will be classified as non-tariff barrier ?

I. Phyto-sanitary measures.
II. Import and export licensing.
III. Countervailing duty
IV. Environmental standards

Select the answer from the code given below.

Codes :

The correct answer is
I and IV

Understanding Non-Tariff Barriers (NTBs)

Non-tariff barriers (NTBs) are trade restrictions imposed by governments that are not in the form of taxes or duties. They include regulations, standards, licensing, quotas, and other administrative measures designed to control or limit imports or exports.

Analysis of Trade Measures

Let's analyze each item to determine if it's a non-tariff barrier:

  • I. Phyto-sanitary measures: These are regulations related to plant and animal health standards. They aim to protect public health and prevent the spread of pests or diseases. While essential for safety, they can act as barriers if overly strict or discriminatory. These are considered NTBs.
  • II. Import and export licensing: This involves requiring government permission before goods can be imported or exported. While sometimes used for legitimate regulatory purposes, licensing systems can be complex and used to restrict trade flows, thus acting as NTBs.
  • III. Countervailing duty: This is a specific type of import tax imposed to offset subsidies given to importers by the exporting country. Since it is a duty or tax, it is classified as a tariff barrier, not a non-tariff barrier.
  • IV. Environmental standards: Similar to phyto-sanitary measures, these are rules and regulations set to protect the environment. They can impact trade by requiring imported goods to meet specific environmental criteria, potentially increasing costs or limiting market access. These are considered NTBs.

Identifying Non-Tariff Barriers

Based on the analysis:

  • Phyto-sanitary measures (I) are NTBs.
  • Import and export licensing (II) are typically considered NTBs.
  • Countervailing duty (III) is a tariff barrier.
  • Environmental standards (IV) are NTBs.

The question asks to identify which among the options are non-tariff barriers. Items I and IV clearly fall under the definition of non-tariff barriers as they represent standards and regulations rather than direct taxes.

Considering the provided options and the common classification of trade barriers, Phyto-sanitary measures (I) and Environmental standards (IV) are the measures identified as non-tariff barriers.

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Important Questions from International Trade

  1. The Net Barter terms of trade refer to:

  2. A sudden shift from import tariffs to free trade may induce short‐term unemployment in:

  3. The theory which explains the effect of devaluation on balance of trade is known as:

  4. Which one of the following is not the disadvantage of international licensing?

  5. Which one of the following factor does not influence the flow of FDI under Demand factors?

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