Nature and Role of Customs Duty in International Trade
Customs duty is a type of tax imposed on goods when they are transported across international borders. It is a key component of a country's trade policy and plays a crucial role in regulating and controlling the flow of goods in and out of a country.

Role of Customs Duty in International Trade
- **Revenue Generation**: Customs duty is a significant source of revenue for governments, which can be used for various public services and development projects.
- **Protection of Domestic Industries**: By imposing customs duty, governments can protect their domestic industries from unfair competition from foreign goods that may be cheaper due to lower production costs.
- **Regulation of Imports and Exports**: Customs duty helps in regulating the volume and types of goods entering and leaving a country, which can have implications for national security, public health, and environmental protection.
- **Trade Balance**: Customs duty can be used to influence the trade balance by encouraging or discouraging the importation of certain goods.

Merits of Customs Duty
- **Protection of Domestic Industries**: Customs duty can help protect domestic industries from being undercut by cheaper foreign goods, thereby safeguarding jobs and promoting economic growth.
- **Revenue Generation**: Customs duty provides governments with a reliable source of revenue that can be used to fund public services and infrastructure projects.
- **Control of Imports**: Customs duty allows governments to control the types and quantities of goods entering the country, which can help prevent the influx of harmful or illegal products.
- **National Security**: Customs duty can be used to regulate the importation of goods that may pose a threat to national security, such as weapons or hazardous materials.
In conclusion, customs duty plays a crucial role in international trade by regulating the flow of goods, protecting domestic industries, and generating revenue for governments. While it has its merits, it is essential for countries to strike a balance between promoting trade and protecting their domestic interests.