Win at WTO against US solar Tariffs Unlikely to Help India Much

Win at WTO against US solar Tariffs Unlikely to Help India Much

India’s complaint against the US, and specifically against 8 US states that added tariffs on renewable sector imports from the country has found support at the WTO, with the global trade body’s dispute panel supporting the Indian stand.

Made public yesterday, the ruling, even as it pronounced the US ‘guilty’ of unfair trade practices in this case, is unlikely to be received in good faith or even accepted by the Trump administration. President Trump has already made his intentions clear, to continue to chip away at the patience of countries, including India, which he claims have been unfair in their trade arrangements with the US.

The WTO panel found US states of California, Connecticut, Delaware, Massachusetts, Michigan, Minnesota, Montana, and Washington guilty of giving tax or financial incentives to domestic producers of renewable energy systems, components or “inputs” made in those states.

The US has predictably denied the findings on the basis that some of the issues are either too old, ‘expired’ or involve small amounts. An excuse it barely tolerates when given by a developing country like India for its own exports to the country.

The 100-page report by the panel is quite detailed, with India’s claims that subsidies and local content requirement in 11 renewable energy programmes in eight US states violated core global trade rules being found accurate. India had pleaded that these actions violated provisions of the Trade-Related Investment Measures (TRIMs) Agreement and Subsidies and Countervailing Measures Agreement.

For India, while the win might serve as a useful bargaining chip in the ongoing discussions with the US, including President Trump’s meeting with PM Modi, the problem has always been one of the sheer cost of an extended tiff, with the delay costing the country a price it can ill afford, something the US has been happy to prey on.

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