Restricting Chinese imports will not be easy
India could revoke the Most Favoured Nation status to Pakistan, but may not be able to do so with China
it considers necessary for the protection of its essential security interests taken in time of war or other emergency in international relations”. The current situation between India and China definitely qualifies as an emergency in international relations. Since this standoff also involves safeguarding India’s territorial sovereignty, there is an “essential security interest” at stake.
The legal challenge for India, in order to make a successful case under Article XXI, will be to demonstrate that the trade-restrictive measure it adopts during this emergency with regard to China is “necessary” to address the current security situation. Contrary to what many believe, the words, “which it considers” in Article XXI (b) (iii) does not make the provision selfjudging. Although India will enjoy significant leeway in determining what constitutes “necessary” measures, these shall be subject to a good faith review. There are two cases in which WTO panels dealing with the national security and defence have affirmed this. These are the Russia-traffic in Transit case involving Russia and Ukraine and the recently decided Qatar — Goods from the UAE case, involving Qatar and the United Arab Emirates.
Therefore, in order to show that the measure adopted is “necessary”, India has to prove two things. First, that India genuinely believes that adopting the measure (say reneging on an MFN obligation) is necessary to protect its essential security interests. Second, as the Russia-transit case demonstrates, the measure meets the minimum requirement of plausibility with regard to the essential security interests in question. In other words, the measure should be connected to the emergency at hand as to make it feasible for the protection of essential security interests.
In Pakistan’s case, India retracted its MFN promise by increasing tariff rates to 200% on all Pakistani imports. Although India’s decision to increase tariffs on Pakistani imports was driven by national security concerns, oddly enough, the notification on this did not even mention national security. This could have been because the