Power & Energy

U.S. lends helping hand to India in raising solar power issue in WTO

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India did not succeed to fulfill norms of World Trade Organization (WTO) ruling on solar power, the United States will address the WTO's dispute settlement body (DSB) next month, triggering a fresh round of litigation, according to an agenda issued recently.

The field of renewable energy has become a hot area for trade friction as major economies of the world compete to dominate this sector which is expected to grow as reliance on coal and oil resources have decreased.

India revealed its national solar programme in 2011, targeting to ease chronic energy shortages in the country without creating pollution. But the U.S. complained to the WTO in 2013, stating the program was discriminatory and U.S. solar exports to India had fallen by 90 per cent from the year 2011.

The case was won by U.S. last year, when the judges of WTO appealed that India had broken the trade rules as the solar power developers use Indian made cells and modules. Use of local content is banned as they discriminate between the domestic firms and foreign competitors.

Under an agreement with the U.S., India should comply with the rules until December 14 and it informed the DSB last week that it had done the needful.

“Indian authorities have held extensive internal stakeholder consultations since the adoption of the rulings and recommendations of the DSB to fully comply with them,” Indian officials said in a statement to the DSB.

 “Accordingly, in-sync with the findings and recommendations made by DSB in this renewable energy dispute, India has ceased to put forth any measures as found to be inconsistent in DSBs findings and recommendations.”

But an agenda for the DSB's next meeting on January 12 revealed that the U.S. plans to again raise the dispute, stressing on WTO rules on non-compliance with trade rulings. If India is found not to have followed the rules, Washington could ask the WTO for permission to put trade sanctions on India. The dispute may continue for at least a year or more.

 

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