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WTO solar dispute: India examining US protectionist programmes 

Our Bureau New Delhi | Updated on January 27, 2018 Published on March 25, 2016

The government is examining options to file a case against the US in the World Trade Organisation based on programmes run by American state governments which give protection to domestic manufacturers.

This was stated by the Minister of State (Independent Charge) for Power, Coal and New & Renewable Energy Piyush Goyal who was addressing an event organised by the Confederation of Indian Industry on Friday.

Commenting on the WTO’s ruling on the mandatory domestic content stipulations in India’s solar power generation programme Goyal said, “There are at least nine US states which have similar programmes that give protection to domestic manufacturers. I am now examining them and after that we will file a case against the US.”

The Minister added, “We will of course go and appeal against the WTO order. But we are ingenious enough in India to find an alternate mechanism to protect our manufacturers.”

While the Jawaharlal Nehru National Solar Mission aims to add 100,000 MW of solar power by 2022, the local content requirement is only for 8,000 MW for rooftop and land-based projects where the government provides a subsidy.

India has been arguing that since the power generated through the JNNSM was bought by NTPC, a public sector agency, the transaction qualifies as government procurement and is not covered by WTO rules.

This was rejected by the WTO which stated that the domestic content requirement was on power equipment and not on power that is bought by the government.

Tarun Kapoor, Joint Secretary of the Ministry of New & Renewable Energy said earlier in the week that the domestic manufacturers will be given protection by procurement through defence agencies and other such means.

“It is very unfortunate that the US decided to pursue their case against India in the WTO. All India has done is protect the domestic manufacturers who have so far given 400 MW of equipment to the installed capacity of 6,000 MW,” said Goyal.

He added, “When India scales up to a 100 GW all that the Indian manufacturers can produce is about 15-17,000 MW over the next seven years. This would still leave more than 80,000 MW of market for the world. The US took a very myopic view.”

The Minister also warned that if Indian manufacturers manage to prove a case of dumping against the US manufacturers, solar power will become expensive forcing the government to abort the solar programme.

“Our own domestic manufacturers had won a complaint against US manufacturers for dumping their products in India which would have resulted in high anti-dumping duties. I personally persuaded the Indian manufacturers and it was their magnanimity who withdrew their request. If Indian manufacturers go back to seeking anti-dumping duties, solar power will again become expensive and we may have to abort the programme,” said Goyal.

Published on March 25, 2016
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