In the context of international trade under World Trade Organization rules, India has withdrawn the Most Favoured Nation (MFN) status from which neighbouring country?

Introduction / Context:
Under World Trade Organization arrangements, member countries often grant each other Most Favoured Nation status, which means they will not discriminate in basic customs duties and trade concessions. India had granted MFN status to several countries, including some neighbours. After specific political and security developments, India decided to withdraw the MFN status from one particular neighbouring country. This question tests your awareness of that major current affairs decision and your understanding of how trade policy and geopolitics are linked.

Given Data / Assumptions:
• The question is about India and the withdrawal of MFN status.
• It clearly refers to a neighbouring country, not a distant trade partner only.
• Options include United States, Bangladesh, Nepal, Pakistan, and Sri Lanka.
• No year is mentioned, but this is widely covered as a significant current affairs event.

Concept / Approach:
Most Favoured Nation status means non discriminatory trade treatment under World Trade Organization rules. Withdrawal of such status is a strong diplomatic and economic signal. India decided to withdraw MFN status from Pakistan after serious security incidents and rising tensions. None of the other countries in the options experienced such a policy change from India at that time. By remembering this key event, you can directly match the correct country from the list provided.

Step-by-Step Solution:
Step 1: Recall which neighbour has had tense relations with India and has been at the centre of major security incidents. Step 2: Remember that as a response, India revoked the MFN status that had been earlier granted under World Trade Organization related commitments. Step 3: Compare this recollection with the options: United States, Bangladesh, Nepal, Pakistan, Sri Lanka. Step 4: Note that the United States is not a neighbouring country and Bangladesh, Nepal, and Sri Lanka did not see MFN status withdrawn in that context. Step 5: Conclude that Pakistan is the only option matching the known event of MFN withdrawal by India.

Verification / Alternative check:
For verification, think of other news connected to India’s trade with Pakistan, such as increases in customs duty on Pakistani imports and calls for stronger economic measures. These were all linked to the same phase when India decided to revoke MFN status. No similar series of steps was taken against Bangladesh, Nepal, or Sri Lanka, and the United States is not geographically a neighbour. Therefore, cross-checking with multiple news items confirms that Pakistan is the correct answer.

Why Other Options Are Wrong:
United States: Although India has trade disputes with the United States at times, the question focuses on a neighbouring nation and on MFN withdrawal, which did not apply in this way to the United States.
Bangladesh: India maintains relatively cooperative relations with Bangladesh; MFN status was not withdrawn in the highlighted context, so this option is incorrect.
Nepal: Relations with Nepal include some disagreements but not revocation of MFN status as discussed here, making this option wrong.
Sri Lanka: No such high profile withdrawal of MFN status occurred in relation to Sri Lanka, so this option does not fit the question either.

Common Pitfalls:
One common error is to focus only on the phrase “Most Favoured Nation” and guess a large economy like the United States, ignoring the word “neighbouring” which is implied by context and is critical. Another mistake is not keeping chronological track of current affairs and mixing events that happened with different countries. For competitive exams, it is important to link the exact measure, such as MFN withdrawal, with the exact country and context to avoid confusion among similar sounding news items.

Final Answer:
India has withdrawn the MFN status from Pakistan.