The World Trade Organization (WTO) has agreed to establish a dispute settlement panel to examine China's complaint against India's import duties and incentive measures on solar energy and information technology products, according to a Geneva-based official cited by the Economic Times.
Dispute Panel Established
India had blocked China's first request to set up a dispute panel in May, the Economic Times reported. However, China's second request was accepted by the WTO's dispute settlement body during a meeting on Tuesday in Geneva. The panel will now determine whether India's import duties and other measures on certain imported high-tech goods, as well as incentive measures for solar energy products, are consistent with India's WTO commitments.
China's Allegations
China has alleged that India's tariffs or import duties on certain technology products, combined with measures favoring domestic products over imported ones, discriminate against Chinese goods, according to the report. Beijing claims these support measures and incentives violate rules under the WTO's General Agreement on Tariffs and Trade 1994, the Agreement on Subsidies and Countervailing Measures, and the Agreement on Trade-Related Investment Measures. China is a major exporter of solar and IT goods, and the measures allegedly harm its exports.
India's Defense and Domestic Measures
India maintained during consultations with China that the measures in question are consistent with its obligations under WTO agreements, the Economic Times reported. India has rolled out a series of initiatives to boost domestic manufacturing in the solar sector, including:
- Imposing duties on imported solar cells and modules
- Mandating the use of locally manufactured solar equipment in certain government-backed projects
- Introducing the Approved List of Models and Manufacturers (ALMM) to encourage procurement from domestic producers
- Implementing a production-linked incentive scheme for the solar sector
These measures are at the heart of the dispute, with China arguing they discriminate against its exports.
Broader Trade Context
In addition to this solar and IT goods case, China is also pursuing a separate dispute at the WTO over India's measures in the automotive and renewable energy sectors, the report noted. The bilateral trade relationship remains significant: China overtook the United States to become India's largest trading partner in 2025-26, with bilateral trade reaching USD 151.1 billion. India's trade deficit with China widened to USD 112.16 billion during the same period, according to the Economic Times.
The establishment of the dispute panel marks the next step in the WTO's dispute settlement process. The panel's findings will have implications for India's domestic solar manufacturing policy and its obligations under global trade rules.
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