China has alleged that India’s tariffs and incentive measures discriminate against Chinese solar energy and information technology products and violate WTO norms.
India had earlier in May blocked China’s request to set up a dispute panel under the aegis of the WTO in the case.
However, China’s second request was accepted by the dispute settlement body, a Geneva-based official said. The request was accepted during a meeting of the body on Tuesday in Geneva.
The panel will now determine whether import duties and other measures applied by India on certain imported high-tech goods, as well as certain incentive measures for solar energy products, are consistent with India’s WTO commitments.
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The request follows the failure of bilateral consultations on reaching a mutually-agreed solution on the dispute filed by China in December last year.India has expressed regret over China’s second request, stating that the WTO’s limited dispute settlement resources should be reserved for genuine and unresolved trade concerns.
The country maintained that during consultations with China, it had demonstrated that the measures in question were consistent with its obligations under the WTO agreements.
In its case, China has alleged that India’s tariff or import duty on certain technology products, and measures like the use of domestic products over imported items, discriminate against Chinese goods.
Beijing, which is a major exporter of goods in these sectors, had claimed that the support measures and incentives infringe rules pertaining to the WTO’s General Agreement on Tariffs and Trade 1994, Agreement on Subsidies and Countervailing Measures, and Agreement on Trade-Related Investment Measures.
Both India and China are members of the WTO. If a member country believes that a support measure under a policy or scheme of another member nation is harming its exports of certain goods, it can file a complaint under the dispute settlement mechanism of the 166-member multilateral body.
India has rolled out a series of measures to promote domestic manufacturing in the solar sector. These include imposing duties on imported solar cells and modules, and mandating the use of locally manufactured solar equipment in certain government-backed projects.
It has also introduced the Approved List of Models and Manufacturers (ALMM) to encourage procurement from domestic producers, besides a production-linked incentive scheme for the sector.
China is also pursuing a separate dispute at the WTO over India’s measures in the automotive and renewable energy sectors.
China has overtaken the US to emerge as India’s largest trading partner in 2025-26, with bilateral trade reaching USD 151.1 billion, while the country’s trade deficit with Beijing widened to USD 112.16 billion during the period.