• Cost advantage for developed countries
  Companies outsource their services to other countries. For example, the US and European countries outsource jobs from the IT and ITES sectors to India which can give them the advantage of having skilled labour at a low cost. This causes companies in Europe and the US to be laid off as the jobs move to developing countries. Protectionism can reduce unemployment as declining industries could be saved from losing more people
  
  
• Checks unfair trade practices
  Some foreign companies indulge in unfair trade practices which involve the buying of goods from a country and selling it in the same country for a price that is less than the usual domestic price of those goods in the country of export. This practice is known as dumping. This is done to capture a market in that country. Domestic industries lose their market share because of dumping. Fair trade can keep a check on practices like dumping by levying trade restrictions
  
  
• Favourable to domestic producers/ Balance of trade
  Tariffs encourage demand for goods produced in the home country. Quotas reduce the volume of imports. Lower imports encourage customers to buy goods that are produced in the country. Therefore trade restrictions are necessary to protect domestic industries
  
  
• Protect manufacture of essential goods
  Fair trade or protectionism is necessary to protect the production of essential goods

• Reduction of profits due to trade barriers
  Protectionism does not allow countries to take advantage of the full benefits of an open market. Trade restrictions can discourage foreign companies from entering new markets as tariffs and quotas would reduce their profits substantially. Moreover controls on exchange can hinder people from obtaining sufficient foreign currency to pay for imports
  
  Developing countries and eastern European countries have taken loans worth billions of dollars from Western banks. Protectionism by the west has made it almost impossible for them to earn the capital necessary to pay back their debts resulting in a debt crisis
  
  
• High cost for low quality
  Fair trade would help companies that are declining. Since people would be forced to buy from industries that are declining, they tend to pay more for goods that are inferior in quality
  
  
• Low transparency
  In some cases goods have been sold as ‘fair trade’ products whereas they have come from producers who are not certified as ‘fair trade’ producers. The Fair Trade Labeling Organization (FLO) sets prices for products certified as fair trade products. But for goods apart from those that are certified there is no fixed price and hence businesses can easily claim that they are ‘fair trade’
  
  
• Rise of infant industries at the cost of other industries
  The government introduces "protection" policies in order to safegaurd the interest of infant industries, however in the bargain, it could hamper the growth of the other industries because the resources required for other industries gets diverted due to protectionism. Hence even if an infant industry is protected it would grow at the cost of the other industries
  
  
• Vicious cycle
  Though protectionist policies seem to be in the interest of the nation, in the long run national protectionism can be like a vicious cycle. If one country puts up trade barriers, then the affected countries would naturally put up their own trade barriers, affecting the exports of that country and ultimately leading to unemployment