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WTO: India Loses Solar Case Against USA
Aug 31, 2015

India has lost another case against the US at World Trade Organisation (WTO) as the body ruled that India's domestic content requirements under its solar power programme were inconsistent with the international norms. Last year, the US dragged India to WTO on country's solar mission plan.

Key Points

  • The US alleged that India's programme appears to discriminate against the US solar equipment by requiring solar energy producers to use locally manufactured cells and by offering subsidies to those developers who use domestic equipment.

  • It also alleged that forced localisation requirements restricted US exports to Indian markets.

  • On January 11, 2010, India launched its national solar policy—Jawaharlal Nehru National Solar Mission.

  • The country has an ambitious target of generating 20,000 MW of solar power by 2022. 

  • The US companies see this target as a great business opportunity for them. Because of this, they want India to remove the clause of local content requirement.

  • India will now appeal against the ruling of WTO's dispute panel in the next two months.

  • This was the second case where India has lost against the US in WTO. 

  • In June this year, India lost a case when the WTO ruled that the Indian ban on import of poultry meat, eggs and live pigs from the US was inconsistent with the global norms.


WTO: At a Glance

The WTO officially commenced on 1 January 1995 under the Marrakech Agreemen,  signed by 123 nations on 15 April 1994, replacing the General Agreement on Tariffs and Trade (GATT), which commenced in 1948. Most of the issues that the WTO focuses on derive from previous trade negotiations, especially from the Uruguay Round (1986-1994).

The World Trade Organization (WTO) is the only global international organization dealing with the rules of trade between nations. At its heart are the WTO agreements, negotiated and signed by the bulk of the world’s trading nations and ratified in their parliaments. The goal is to help producers of goods and services, exporters, and importers conduct their business.


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