WTO RULES FOR INDIA IN DISPUTE WITH US ON SOLAR-PANEL INCENTIVES
India
has won a major trade dispute against the US on Thursday, with a panel at the
World Trade Organization ruling that subsidies and mandatory local content
requirement instituted by eight American States were against the core global
trade.
The
two countries have been contesting each other’s domestic content requirement
for the solar energy sector. India’s move to oppose subsidies for local units
in the US was seen as retaliation to a similar move by the US against India’s
plan to deploy solar power generation projects with mandatory local sourcing
requirements.
The
panel largely upheld India’s claims that subsidies and local content
requirement in 11 renewable energy programmes in eight US States violated core
global trade rules. It also asked the US to ensure that these States are in
conformity with trade rules. America had launched a similar trade dispute
against India’s Jawaharlal Nehru Solar Energy Mission in 2014 on the grounds
that it included incentives for domestically-produced solar cells and modules.
WTO’s Appellate Body had upheld the US complaint against India in that case.
In
January 2017, India had moved the WTO against some of the American States
programme alleging that these barriers were instituted by the States of
Washington, California, Montana, Massachusetts, Connecticut, Michigan, Delaware
and Minnesota, in the energy sector.
India
claimed that the measures appear to be inconsistent with Articles of the
General Agreement on Tariffs and Trade (GATT) 1994, Trade-Related Investment
Measures (TRIMs) Agreement; and the Subsidies and Countervailing Measures (SCM)
Agreement. In January 2017, India requested establishment of a panel to examine
these allegations.
In
March 2017, the WTO Dispute Settlement Body established a panel in which
Brazil, China, the European Union, Indonesia, Japan, Korea, Norway, the Russian
Federation, Saudi Arabia, Singapore, Chinese Taipei and Turkey reserved their
third-party rights. The panel report was circulated to members earlier this
week.
The
panel exercised judicial economy (decided not to rule on the other allegations
since inconsistency has been established in one) on India's claims under
Articles 2.1 and 2.2 of the TRIMS Agreement and Articles 3.1(b) and 3.2 of the
SCM Agreement.
“The
panel found that all of the measures at issue are inconsistent with Article
III:4 of the GATT 1994 because they provide an advantage for the use of
domestic products, which amounts to less favourable treatment for like imported
products,” the WTO said.
Source:-thehindubusinessline
India
has won a major trade dispute against the US on Thursday, with a panel at the
World Trade Organization ruling that subsidies and mandatory local content
requirement instituted by eight American States were against the core global
trade.
The
two countries have been contesting each other’s domestic content requirement
for the solar energy sector. India’s move to oppose subsidies for local units
in the US was seen as retaliation to a similar move by the US against India’s
plan to deploy solar power generation projects with mandatory local sourcing
requirements.
The
panel largely upheld India’s claims that subsidies and local content
requirement in 11 renewable energy programmes in eight US States violated core
global trade rules. It also asked the US to ensure that these States are in
conformity with trade rules. America had launched a similar trade dispute
against India’s Jawaharlal Nehru Solar Energy Mission in 2014 on the grounds
that it included incentives for domestically-produced solar cells and modules.
WTO’s Appellate Body had upheld the US complaint against India in that case.
In
January 2017, India had moved the WTO against some of the American States
programme alleging that these barriers were instituted by the States of
Washington, California, Montana, Massachusetts, Connecticut, Michigan, Delaware
and Minnesota, in the energy sector.
India
claimed that the measures appear to be inconsistent with Articles of the
General Agreement on Tariffs and Trade (GATT) 1994, Trade-Related Investment
Measures (TRIMs) Agreement; and the Subsidies and Countervailing Measures (SCM)
Agreement. In January 2017, India requested establishment of a panel to examine
these allegations.
In
March 2017, the WTO Dispute Settlement Body established a panel in which
Brazil, China, the European Union, Indonesia, Japan, Korea, Norway, the Russian
Federation, Saudi Arabia, Singapore, Chinese Taipei and Turkey reserved their
third-party rights. The panel report was circulated to members earlier this
week.
The
panel exercised judicial economy (decided not to rule on the other allegations
since inconsistency has been established in one) on India's claims under
Articles 2.1 and 2.2 of the TRIMS Agreement and Articles 3.1(b) and 3.2 of the
SCM Agreement.
“The
panel found that all of the measures at issue are inconsistent with Article
III:4 of the GATT 1994 because they provide an advantage for the use of
domestic products, which amounts to less favourable treatment for like imported
products,” the WTO said.
Source:-thehindubusinessline
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