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The “trilateral trade block” has been established among Canada, the United States, and Mexico based on the governmental signs which develop the “North American Free Trade Agreement”. The prime goal of NAFTA is to reduce all non-tariff and tariff barriers of investment and trade among the United States, Mexico, and Canada. This also includes the important role of NAFTA in order to enhance the growth of free trade within the poor regions of India.
Concept of North American Free Trade Agreement
NAFTA refers to the agreement for reducing the non-tariff and tariff barriers among the United States, Mexico, and Canada on service and products. This includes the prime concern to enhance the regulatory agenda of the “Department of Transportation” with projected rulemakings and regulations. The NAFTA agreement has a positive effect on the economic growth of India. This is associated with new exporting opportunities to build competitive businesses which help to attract huge foreign investment. The promotion and the protection of a healthy workplace are being provided through the “Labor side agreement”.
The role of NAFTA in the international trade
The goal of NAFTA is to reduce the international trading costs and also increase business investment into the global marketplace of North America. In other words, the purpose of the “North American Free Trade Agreement” includes the elimination of international trade barriers and facilitating the “cross-border movement” of services and goods. In order to take part in the fair competition of free trade, the required conditions are promoted through NAFTA. The investment opportunities are increased for enhancing the investment rates in the businesses that improve the growth of international trade. The appropriate resolutions for trade disputes are created by following the procedures that are mentioned in NAFTA.
The impact of the North American Free Trade Agreement on the growth of free trade in India
The free trade agreement treaties for regulating the taxes, tariffs, and duties that impose on the exports and imports. The advantages of NAFTA have an impact on jobs, living standards, and business growth across Indian society. The economic growth of India has been increased by 0.1% to 0.5% every year which has been estimated by the “International Trade Commission”. Domestic businesses and industries across India are protected through the dynamic business climates which have been developed by NAFTA. The protection often makes it non-competitive among the domestic industries across the global market. The global competitors are motivated through the protections that are provided by the free trade agreement. The Indian government subsidizes the local industries and the funds are used further based on their requirements. The rate of “foreign direct investment” of India has been increased by 84% from the economic aspects. This also helps to expand the business range of local industries across the Indian marketplace. In order to encourage domestic businesses, the Indian government is required to develop financial resources for enhancing the investment rate. The global industries have more expertise as compared with domestic companies of India for developing local resources that have an impact on the global competition.
Most evaluated benefits from NAFTA
The most evaluated benefit that has been achieved from NAFTA is associated with the elimination of all tariffs and non-tariff barriers of trade across the global marketplace. NAFTA has also created an important agreement on international trade rights for the business financier. This also helps to spur the small businesses to enhance their business growth and investment rates. The lower tariffs have also reduced the import prices of the local industries across Indian society increases the existing business range within the marketplace. The interest rates are reduced by the Federal Reserve and are able to minimize the risk of inflation.
Conclusion
The “trilateral trade block” has been developed through NAFTA by the governmental signs of Canada, the United States, and Mexico. The prime concern to develop NAFTA is to reduce the tariff and non-tariff barriers of investment and trades in the countries. This also includes the international trade costs that are reduced by NAFTA for enhancing the business investment into the global marketplace of North America. The “North American Free Trade Agreement” has a positive impact on the economic growth of India by maintaining regulation of free trades.
