China files complaint against India in World Trade Organisation over EV, battery subsidies
🇨🇳 China Files WTO Complaint Against India Over EV & Battery Subsidies
Context
China has filed an official complaint against India at the World Trade Organization (WTO), alleging that India’s electric vehicle (EV) and battery subsidies violate WTO trade norms.
Key Allegations by China
- India’s EV subsidy policies breach WTO principles of national treatment.
- The measures are classified as import substitution subsidies, which are prohibited under multilateral trade rules.
- China claims these subsidies unfairly benefit Indian manufacturers and discriminate against foreign (Chinese) automakers.
India’s Response
- Commerce Secretary Rajesh Agrawal stated that India will review China’s detailed submission.
- The consultation phase — the first step in WTO’s dispute settlement process — has been initiated.
- Similar complaints have also been filed by China against Türkiye, Canada, and the European Union.
Background
- The move comes as Beijing seeks to expand exports of EVs amid domestic overcapacity and declining sales.
- Chinese automakers, including BYD, view India’s large auto market as a key growth destination.
- The E.U. has recently imposed 27% tariffs on Chinese EV imports, pushing China to look toward Asian markets.
Trade Snapshot
| Parameter | FY 2023–24 | FY 2024–25 | Change |
|---|---|---|---|
| India’s Exports to China | $16.66 bn | $14.25 bn | ↓ 14.5% |
| Imports from China | $101.73 bn | $113.45 bn | ↑ 11.52% |
| Trade Deficit | — | $99.2 bn | Widened |
Indian Policy Measures Under Scrutiny
- EV Policy 2025
- Production Linked Incentive (PLI) Scheme for advanced battery and EV manufacturing.
Both aim to boost domestic production and reduce import dependence, especially on Chinese suppliers.
Significance
- Marks first WTO trade dispute between India and China post the Ladakh border standoff (2020).
- Could impact India’s EV expansion goals and foreign investment sentiment.
- Tests the balance between green industrial policy and global trade commitments.