Earlier this year, the US requested consultations with India pursuant to World Trade Organization (WTO) rules concerning domestic content requirements under India’s Jawaharlal Nehru National Solar Mission for solar cells and solar modules.
Specifically, the request for consultations alleges that “India requires solar power developers, or their successors in contract, to purchase and use solar cells and solar modules of domestic origin in order to enter into and maintain certain power purchase agreements under the NSM or with National Thermal Power Company Vidyut Vyapar Nigam Limited or the Solar Energy Corporation of India. In addition, solar power developers, or their successors in contract, receive certain benefits and advantages, such as long-term tariffs for electricity, contingent on their purchase and use of solar cells and solar modules of domestic origin.”
According to sources, talks between the two sides have failed to produce a satisfactory solution raising the likelihood of the matter going to a dispute settlement panel in May. Tarun Kapoor, India’s Joint Secretary of the Ministry of New and Renewable Energy noted that “Once WTO starts investigation in the matter, it will go on for a year. We will contest the charges in front of the panel and maintain our stand that the policies under the country’s flagship solar programme aren’t anti-competition.” India may counter US complaints by alleging that 13 states have preferential schemes for the purchase of power produced by US made solar products.
