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In this YouTube tutorial, Dr. Arid Siddiqui from the Indian Institute of Foreign Trade discusses the importance of contracts in international trade. Contracts are crucial as they serve as the only binding factor between parties in different countries. The video covers various important clauses in a contract, including how disputes may be settled and the jurisdiction involved. Understanding and analyzing trade terms between parties, negotiating power, and creating a balanced agreement are key aspects of a contract in international trade.