Read the following statements carefully and choose the correct option regarding Assertion (A) and Reason (R).
Assertion (A): WTO encourages free and fair trade across nations.
Reason (R): It allows countries to impose arbitrary restrictions to protect domestic industries.
Show answer & explanation
Correct answer: C
Explanation
The correct answer is option 3 i.e. A is true but R is false.
The World Trade Organization (WTO) aims to liberalize international trade by reducing barriers like tariffs and quotas, ensuring trade flows smoothly and predictably. While it allows for certain protections under specific "anti-dumping" or safety rules, it strictly prohibits countries from imposing arbitrary or unfair restrictions. Therefore, while the WTO promotes global cooperation (A), the claim that it encourages arbitrary protectionism (R) contradicts its core mission of fostering a transparent and open trading system.