The WTO's consensus-based decision-making is increasingly being undermined by plurilateral agreements, threatening the multilateral trading order. Examine.

Question

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Introduction

The WTO’s consensus-based decision-making, a cornerstone of its legitimacy, is increasingly strained by the rise of plurilateral agreements (Joint Statement Initiatives—JSIs), raising concerns about fragmentation of the multilateral trading system.

Body

Consensus ensures sovereign equality (one country, one vote) and inclusivity, particularly safeguarding developing countries. However, with 164 members and divergent interests, it has led to negotiation deadlocks (e.g., Doha Round stalemate). In response, groups of willing members have pursued plurilateral deals on issues like e-commerce, investment facilitation, and services domestic regulation, aiming for faster rule-making.

While plurilaterals can inject flexibility and progress, they risk undermining multilateralism. First, they create a two-tier system, where rule-making shifts to coalitions dominated by developed countries, marginalising others. Second, many JSIs operate outside the formal WTO framework, raising questions about legality and consensus bypass. Third, they may impose de facto standards that non-participants must eventually adopt, eroding policy space—especially for countries like India that have resisted joining certain JSIs. This weakens the Most-Favoured-Nation (MFN) principle and the development-oriented ethos of the WTO.

However, a rigid insistence on unanimity can paralyse reform. Carefully designed plurilaterals—open, transparent, and MFN-consistent—can act as building blocks for eventual multilateralisation, as seen in earlier agreements like the Information Technology Agreement (ITA).

Conclusion / Way Forward

The challenge is to balance efficiency with inclusivity. Strengthening consensus through issue-based coalitions, safeguarding S&DT, and ensuring plurilaterals remain open and WTO-consistent is essential. Revitalising dispute settlement and trust among members will be key to preserving a rules-based, multilateral trading order.

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