WTO sets up panel in China's case against India's certain auto, renewable measures

India and China are members of the World Trade Organisation

The World Trade Organisation's dispute settlement body has set up a panel in a case filed by China against India over its measures in the automotive and renewable energy sectors, an official said on Tuesday.

The panel was set up as both sides failed to resolve the issue through a bilateral consultation process under the aegis of the WTO.

In October last year, Beijing alleged that certain conditions in India's Production Linked Incentive (PLI) schemes for advanced chemistry cell batteries, automobiles and the policy to promote the manufacturing of electric vehicles violate global trade rules by discriminating against Chinese goods.

"At the second request of China, the Dispute Settlement Body (of the WTO) agreed at its meeting to establish a panel to examine certain Indian measures in the automotive and renewable energy sectors," the Geneva-based official said.

In a communication to the World Trade Organisation (WTO), China has stated that consultations were held on November 25, 2025, and January 6, 2026, with a view to reaching a mutually agreed solution. Unfortunately, those consultations failed to resolve the dispute.

Seeking consultation is the first step of the dispute settlement process as per WTO rules. If the consultations requested by the complainant do not result in a satisfactory solution, it can request that the WTO set up a panel in the case to rule on the issue raised.

India and China are members of the World Trade Organisation (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 WTO.

China is the second-largest trading partner of India.

In the last fiscal, India's exports to China contracted 14.5 percent to $14.25 billion against $16.66 billion in 2023-24. The imports, however, rose by 11.52 per cent in 2024-25 to $113.45 billion against $101.73 billion in 2023-24.

India's trade deficit with China has widened to $99.2 billion during 2024-25.