USTR Requests WTO Panel on Indian Solar, Despite Activist Resistance
The World Trade Organization on April 25 postponed a decision on a U.S. request that the WTO create a panel on the domestic content requirements in India’s solar energy program. The Office of the U.S. Trade Representative (USTR) initiated consultations in February with India over the National Solar Mission, a program USTR claims violates WTO rules. The panel request indicates the consultations failed to bridge gaps. U.S. and India previously held consultations over the issue in February 2013. “India said that it was disappointed with the U.S. request to establish a panel and believed that a mutually agreed solution was still possible,” said the WTO. “India, therefore, was not in a position to agree to the establishment of a panel. In that regard, the DSB deferred the establishment of a panel to examine this matter.” USTR Michael Froman argued the forced localization barriers hike up the cost of solar energy across the globe, including in India (see 14021102).
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Several U.S. environmental groups, including Greenpeace and Sierra Club, pressed USTR to not request the panel in an April 23 letter to Froman. The petition will shake investor confidence and scale back solar industry growth in India, said the letter. “Using the WTO to address U.S. concerns about the expansion of India’s domestic content rules to thin film solar technologies, which currently comprise the majority of U.S. solar exports to India, will be counterproductive,” it said. “While it is critical to support and build a U.S. solar industry, the development of our solar industry should not come at the expense of India’s ability to develop its solar industry. In addition, our own solar industry is harmed, not served, by new trade conflicts that undermine investor confidence and stifle growth in the solar market.”
The U.S. should instead support an Indian solar industry that has grew 100 percent from the end of 2012 to the end of 2013, the letter said. “India’s solar market is growing fast but still at a nascent stage,” said the letter. “This case would actually serve to increase uncertainty in the solar market which is damaging not only to India’s solar development, but to global solar development. The U.S. should not compromise the long-term growth of the solar market just so that it can achieve limited near-term gain.”