India's Solar Energy Dispute with the US: A WTO Case Study Analysis

This case study examines the international trade dispute between India and the United States concerning India's domestic content requirements (DCR) in the Jawaharlal Nehru National Solar Mission (NSM). The United States challenged India's DCR measures at the World Trade Organization (WTO), alleging violations of the General Agreement on Tariffs and Trade (GATT) 1994 and the Trade-Related Investment Measures (TRIMs) Agreement. The WTO's Appellate Body upheld the panel's finding that India's DCR measures were inconsistent with WTO non-discrimination obligations. The case details the chronological events, the involvement of other countries, the proceedings of the panel, and the final rulings. The study highlights the arguments made by both parties, the role of the Dispute Settlement Body, and the implications for international trade, particularly in the renewable energy sector. Ultimately, India prevailed in the dispute, showcasing the importance of WTO regulations in resolving trade conflicts.

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The case study completely analyses on the varied domestic content requirement (DCR)
measures which were imposed by India during the initial phase of India's Jawaharlal Nehru
National Solar Mission (NSM). United Nations on the hand called for a detailed discussion
and consultation with India regarding certain core measures adopted by India relating to
Jawaharlal Nehru National Solar Mission (NSM) for solar cells and solar modules. However
United Nation’s Appellate Body upheld the Panel's finding that India's DCR measures were
inconsistent with WTO non-discrimination obligations under Art. III: 4 and Art. 2.1 ().
Successively varied other countries agreed to join this discussion which included Brazil,
Canada, China, the European Union, Japan, Korea, Malaysia, Norway, the Russian
Federation and Turkey. Finally on 14 April 2014, the United States requested the
establishment of a panel. The appellate body proceedings generally consisted of the primary
claims that were brought by United States significantly related with the concerns of
domestic content requirements (DCR measures). The panel found that the
DR measures were inconsistent with both Article III:4 of the GATT 1994
and Article 2.1 of the TRIMs Agreement
The concerned topic is about is the dispute and violation of international rules in the
treatment of solar energy systems under the ‘JAWAHARLAL NEHRU NATIONAL SOLAR
MISSION’ for installation of cells and modules powered by solar energy. The chronological
day was 06/02/2013 when a request for consultation was made by the United States of
America towards India for additional requirement of national content under the above-
mentioned mission.
According to the United States of America, India violated a number of Acts in completing the
above mission and the articles are:

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1. Treaty: General Agreement of Tariff and Trade, 1994, Article 3, frequency: Four
2. Treaty: Trade Related Investment Measures, Article: 2.1
3. Agreement: Subsidies and Countervailing measures, Article: 3.1.b,3.2.5.c, 6.3.a, 6.3.c
and 25.
The claiming party, America states that India through the violations of the law are reducing
the benefits. Though the benefits are not direct in nature, the indirect accrued benefits are
being affected.
Other countries to join the consultation are Japan and Australia on 13/02/2013 and 21/2/2013
respectively.
The United States of America initiated a proposal for the Construction of a panel on
14/04/2014. The meeting was held on 25/04/2014 where the Dispute Settlement Board
initiated the process.
Further Proceeding of the Panel
The member countries in the panel were Turkey, Malaysia, Korea, Japan, EU, Russian
Federation, Brazil and Canada. By the third party rights, other countries who became active
members of the panel are Taipei, Ecuador and Saudi Arabia. The final composition of the
panel was executed on 24/09/2014.
The panel chairperson on 24/03/2015 that they will upload the conclusive report by the end of
August, 2015. The date was mutually decided upon by the all the member parties.
The tension between the two parties started with the issue when Washington DC ruled out the
benefits to the exports of India along with high duties being imposed by the government of
India of twenty eight foreign products based from America.

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According to the rules and regulations of World Trade Organization, the body associated with
the settlement of disputes. It shall adopt the report of the panel within a circulating period of
twenty to sixty days, until in the case that the Dispute Settlement Body plans to decide
through a consensus not to undertake the report or in the case that either of the parties notify
and appeal for making crucial decision.
Total Time Estimated
The government of India informed the Dispute Settlement Body that it intends to implement
the rulings and recommendations of DSB as a pursuant to Article 21.3 of the DSU on 8
November 2016. Previously, India and the USA jointly informed the DSB that the mutually
agreed period of fourteen months are needed to settle the full case. The tenure will exhaust on
14/12/2017.
Government of India found out the report prepared by the Dispute and Settlement Body
eliminated facts, which were inclined towards India, so the report was rejected on
19/10/2017.
According to USA, India did not comply with the rules and Regulations of the Dispute and
Settlement Body. Therefore, it requested the government body to suspend the concessions
and several other obligations according to Article 22.2 of DSU. On the other hand, India
complained that USA filed the suspension of the agreement by suspending Article 22.6 of the
DSU on 19/12/2019. In addition, the American government also did not follow the mutually
agreed time of fourteen months.
To conclude the topic American Government tried to gain an upper hand in the multi-million
dollar agreement with India in the installation of solar panel and solar devices in America
under the ‘JAWAHARLAL NEHRU NATIONAL SOLAR MISSION’. However, as the
deciding body was World Trade Organization known for its global fairness, India got the

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advantage of the strategic leverage when USA is trying to create more disputes in the
bilateral trade between the two concerned countries. The renewable energy sector war was
finally won by India and being one of the most profitable and market capturing business in
the future, it is a big win for India.

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