According to reports, the United States has approached the World Trade Organization (WTO) against India’s policy requiring power producers to use locally sourced content in the Jawaharlal Nehru Solar Mission, prompting India to consider a retaliatory complaint against America’s similarly restrictive policies in the sector in 13 of its states. Talks between the two sides over purchase of solar equipment from American firms failed to convince the US, a commerce department official said, adding that the issue is likely to escalate into setting up of a dispute settlement panel within the global trade body in May.
“The solar issue could not be sorted out in the consultations, as per the US, which has now asked for setting up of the dispute settlement panel,” said the official, who did not wish to be identified.
India is likely to counter this since the country has been WTO compliant in its solar mission, the official said. “India will likely seek consultation for non-compliance of WTO laws by the US. The US has done so many things which are WTO non-compliant and India has been tolerating it. There is a strong view in certain quarters that we should retaliate,” he added.
The US has alleged discrimination against solar cells and modules made in America owing to the requirement that solar power developers participating in phase-II of National Solar Mission use solar cells and modules manufactured only in India.
“Definitely the domestic content requirements restrict our entitlement and in the specific example of the JNNSM Phase-II this creates a 50% restriction of the specific demand that was originally intended from this programme,” said the spokesperson of First Solar, a major US manufacturer of solar cells and the prime exporter to India. First Solar participated in the project development bidding of JNNSM and won a 30 mw solar power project.