Back And Forth On Free Trade & Protectionism

It is over 200 years since nation states are devising strategies for economic growth based on the principle of free trade. Adam Smith, in the Wealth of Nations has advocated the concept of 'laissez faire', that is markets must be free and left to regulate themselves by means of competition and self-interest. David Ricardo's theory of international trade notes that nations have comparative advantages in production of certain goods, and hence can achieve higher standards by trading in such goods.

With the dramatic increase in international trade, it became evident that international trade will not only need to be free, but also fair. The Indian Supreme Court in the case of Reliance Industries¹ has said that the purpose of trade remedial measures under Article VI of the General Agreement on Tariffs and Trade 1994 (GATT 1994) is not protectionism in the classical sense (as proposed by the German economist Friedrich List in his famous book 'National System of Political