Skip to main content

Sign up for our newsletter.

Quality journalism. Progressive values. Direct to your inbox.

A solar panel sits in a field in Mathura, Uttar Pradesh, India.  (Photo: Asian Development Bank/flickr/cc)

'Trade Rules Trump Climate': WTO Deals Blow to India's Solar Program

Providing local green jobs no match for US challenge using powerful trade rules

Andrea Germanos

In an outcome described as an outrage and a blow for local green jobs, the World Trade Organization ruled Wednesday in favor of the United States in its challenge to India's rapidly growing solar energy program.

It marks "a step in the wrong direction, away from the climate progress that the global community committed to achieve in December’s Paris climate agreement," according to Ilana Solomon, director of the Sierra Club’s Responsible Trade Program.

The U.S. had initiated its challenge to part of India’s National Solar Mission in Feb. 2013. The problem, as the U.S. saw it, was the part of India’s National Solar Mission requiring solar power developers to use solar cells and modules that are made in India rather than in the U.S. or other another country. The WTO dispute settlement panel agreed with the U.S. that this locally-favoring requirement is "inconsistent" with and "not justified" by WTO rules.

And India's solar mission meant lost profits for the United States.  As the office of the U.S. trade representative stated following the ruling, "Since India enacted these domestic content requirements in 2011, U.S. solar exports to India have fallen by over 90 percent."

In addition, as Solomon and Ben Beachy, senior policy advisor with Sierra Club's Responsible Trade Program, write,

Though India argued that the program helps the country to meet its climate commitments under the United Nations Framework Convention on Climate Change (UNFCCC), the WTO rejected that argument. Indeed, the ruling boldly states that domestic policies seen as violating WTO rules cannot be justified on the basis that they fulfill UNFCCC or other international climate commitments. In effect, the WTO has officially asserted that antiquated trade rules trump climate imperatives.

The ruling sparked a similar reaction from Bill Waren, senior trade analyst at Friends of the Earth. "The government of India reasonably provided some preferences for local producers of solar energy in order to convert from a carbon economy to a green economy. The WTO decision, finding India’s solar energy program a violation of international trade law, is an outrage. Trade law trumps the Paris climate accord," he stated.

The Obama administration, for its part, welcomed the WTO decision as a "victory" and said it sent a warning shot.

"This is an important outcome, not just as it applies to this case, but for the message it sends to other countries considering discriminatory 'localization' policies," U.S. Trade Representative Michael Froman said in a statement.

One thing Froman and environmental groups agree on is that the ruling is of particular importance in light of the Trans-Pacific Partnership (TPP) trade pact, which President Obama is pushing Congress to approve.

"This win underscores not just how aggressive and successful the Obama Administration has been in terms of enforcing our current trade agreements, but also the resolve with which we will enforce the high standards negotiated in TPP, whether it's with regard to labor, intellectual property rights or the environment," Froman stated.

Sierra Club, however, says that the WTO decision should be a warning for lawmakers to reject the TPP.

"Indeed," Beachy and Solomon write, "the text of the controversial deal replicates the very rules that the WTO used against India's solar program today. While many in Congress oppose the TPP, if the deal were to pass, we could see even more trade cases against clean energy initiatives. Congress should view this ruling as further confirmation that a vote against the TPP is a vote for green jobs and climate action."

The Calcutta Telegraph reports that India is likely to appeal the ruling, which it has 60 days to do.


Our work is licensed under Creative Commons (CC BY-NC-ND 3.0). Feel free to republish and share widely.

We've had enough. The 1% own and operate the corporate media. They are doing everything they can to defend the status quo, squash dissent and protect the wealthy and the powerful. The Common Dreams media model is different. We cover the news that matters to the 99%. Our mission? To inform. To inspire. To ignite change for the common good. How? Nonprofit. Independent. Reader-supported. Free to read. Free to republish. Free to share. With no advertising. No paywalls. No selling of your data. Thousands of small donations fund our newsroom and allow us to continue publishing. Can you chip in? We can't do it without you. Thank you.

Scientists Revive ‘Zombie’ Virus After 50,000 Years Trapped in Siberian Permafrost

Researchers documented 13 never-before-seen viruses that have been lying dormant, frozen in thick ice, over tens of thousands of years.

Common Dreams staff ·


'Cleaner Air Is Coming' as London Expands Vehicle Pollution Fee to Entire Metro Area

"Around 4,000 Londoners die prematurely each year because of long-term exposure to air pollution, with the greatest number of deaths in outer London boroughs," noted Mayor Sadiq Khan in announcing the expansion.

Brett Wilkins ·


'Amazing News': Historic Shark Protections Approved at Global Wildlife Convention

Up to 90% of sharks targeted by the lucrative fin trade will now be protected, said one advocate.

Julia Conley ·


'The Nightmare Materializes': Far-Right Extremist Itamar Ben-Gvir to Be Israel's National Security Minister

The Foreign Affairs Ministry of the Palestinian Authority said Ben-Gvir's elevation to national security minister could have a "catastrophic impact on the Israeli-Palestinian conflict."

Jake Johnson ·


Raging Wars, Soaring Hunger Put Women and Girls in Crosshairs, Warns UN

"A toxic mix of crises—conflicts, climate, skyrocketing costs, and the ripple effects of the Ukraine war—are inflicting a devastating toll on the forcibly displaced. This is being felt across the world, but women and girls are particularly suffering."

Brett Wilkins ·

Common Dreams Logo