Switzerland revoked 'Most Favored Nation' status given to India?
Switzerland revoked 'Most Favored Nation' status given to India?Switzerland has announced the revocation of the 'Most Favored Nation' (MFN) status given to India. Which is being considered a big setback for the trade relations of the two countries. switzerland has taken this decision after the recent decision of the indian Supreme court in the Nestle dispute. This announcement has brought a new turn in the trade, investment and taxation agreements between switzerland and India. This change, which will come into effect from January 1, 2025, will be especially important for those Indian companies which are doing business or investing in Switzerland.What is 'Most Favored Nation' status and why is it given?'Most Favored Nation' (MFN) is a trade provision, which is applicable between the member countries of the World Trade Organization. Under this, one country gives trade benefits to another country without any discrimination. If a country gives special benefits in trade to a third country, then other countries also automatically get this benefit under MFN. Its main objective is to reduce trade barriers and promote trade between countries. MFN status ensures for any country that it will get the same opportunities and benefits as any other country in trade matters.A 'Double Tax Avoidance Agreement' was signed between india and switzerland in 1994, which also included the MFN provision. Under this, switzerland gave this status to india, which facilitated the trade and investment relations of the two countries. With this agreement, indian companies working in switzerland got tax exemption and their investment was also safe.