Question
With reference to Trade-Related Investment Measures (TRIMS), which of the following statements is/are correct?
1. Quantitative restriction on imports by foreign investors are prohibited.
2. They apply to investment measures related to trade in both goods and services.
3. They are not concerned with the regulation of foreign investment.
Select the correct answer using the code given below:
(a) 1 and 2 only
(b) 2 only
(c) 1 and 3 only
(d) 1,2 and 3
Answer:
C
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Explanation:
1. Statement 1 is correct because under Trade-Related Investment Measures (TRIMS), quantitative restrictions on imports by foreign investors are prohibited. TRIMS aims to eliminate measures that restrict or distort international trade, including import restrictions.
2. Statement 2 is incorrect because TRIMS specifically focus on investment measures related to trade in goods, not services. It does not cover regulations or measures related to services trade.
3. Statement 3 is correct because TRIMS are concerned with the regulation of foreign investment. They address specific trade-related aspects of investment measures imposed by governments, such as local content requirements, trade balancing requirements, and export obligations. TRIMS aim to ensure that these measures do not create unnecessary barriers to trade or discriminate against foreign investors.