Wto Trade Dispute Between the United States and India over Solar Cells and Solar Modules

Topics: Solar cell, Photovoltaics, World Trade Organization Pages: 8 (2856 words) Published: July 18, 2013
WTO Trade dispute between the United States and India over Solar Cells and Solar Modules

Nathan Naegle
International Political Economy
Professor He

This paper focuses on WTO trade dispute between the United States and India over Solar Cells and Solar Modules. I take an in depth look at the dispute from professionals that have posted about the issue online. I also relate the exact infringements that the US claims that India is in violation of in the WTO trade agreements. I then examine the state centered approach of India and the society centered approach of the United States. How these two approaches can cause this conflict that we are currently seeing in the WTO. In my conclusion, I act as a WTO representative and determine whether or not India is truly in violation of the WTO trade agreements.

On 6 February 2013, the United States requested consultations with India concerning certain measures of India relating to domestic content requirements under the Jawaharial Nehru National Solar Mission (“NSM”) for solar cells and solar panels. This current World Trade Organization (WTO) dispute is very interesting to me because I use solar panels in at work often. They are an interesting technology that could be a great opportunity for the United States to have a competitive advantage in the production of the technology of solar panels and solar cells. There are many interesting arguments to this current dispute. I am going to explore in depth the infractions of the WTO measures that the United States claims that India is infraction of with their current political stance in the Ministry of New and Renewable Energy. After I discuss the current issues of this dispute, I will make a decision posing as a WTO representative. Research

Phase I of India’s Solar Mission, which draws to a close at the end of this month, requires crystalline silicon (cSi) solar photovoltaic (PV) projects to use Indian-manufactured modules and concentrating solar power (CSP) projects to use at least 30 percent Indian-manufactured equipment. During Phase I, thin film solar PV panels were exempted from the DCR due to the lack of thin film manufacturing within India. The U.S. complaint to the WTO claims that India’s DCR discriminates against foreign-manufactured solar equipment. India has countered that because the government provides financial incentives and subsidies to solar projects; it has the right to establish a Solar Mission domestic content requirement (DCR) through government procurement exceptions to WTO nondiscrimination rules. In a recent similar case, the WTO ruled against Canada regarding DCR provisions in a green energy plan for Ontario, casting some doubt on India’s prospects. India and the United States have 60 days from the February 6 complaint filing to resolve the dispute through consultations, after which time the United States can request that the WTO review its challenge. (Makhijani, 2013) Should trade wars and protecting local jobs get in the way of clean energy? That's the dilemma before India – and the world – at the moment. Desperately short of power, but with an average of 300 sunny days a year, India is aggressively pursuing solar energy. Its national solar program, the grandly named Jawaharlal Nehru National Solar Mission (named after India's first prime minister) plans to generate 20,000 megawatts of solar power by 2022. But an ugly trade spat with the US may frustrate India's efforts to go solar. Things got worse. The 60-day consultation ended on 7 April, and with no sign of a compromise, the US may now ask the WTO to resolve the complaint. India, meanwhile, is not taking things lying down. On 17 April, it retaliated by asking the US to justify trade restrictions in its own renewable energy projects, arguing that incentives offered to U.S. companies to use local labour make it equally difficult for Indian companies to enter the US. (Rao, 2013) Doing the research for this complex problem, I found that it...
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