China Objects PLI Schemes For Auto, Auto Components, Batteries And Electric Cars At WTO
China maintains that the measures are contingent on the use of domestic over imported inputs or are otherwise discriminatory against Chinese products: Reports
Chennai: China has raised objections against India at the WTO and sought consultations over the PLI schemes for auto and auto components, advanced chemistry cell and battery storage as well as scheme electric passenger cars as it finds that certain requirements for the schemes are inconsistent with India's obligations under the SCM Agreement, the GATT 1994 and the TRIMs Agreement of the WTO.
China maintains that the measures are contingent on the use of domestic over imported inputs or are otherwise discriminatory against Chinese products. Hence, they are inconsistent with various provisions under the Agreement on Subsidies and Countervailing Measures, the Agreement on Trade-Related Investment Measures, and the General Agreement on Tariffs and Trade 1994.
The incentives provided by India under each of the three programmes are conditioned on compliance with certain requirements, including domestic value addition (DVA) requirements. Among other things, these requirements appear to link the eligibility for incentives and the amount awarded to the use of inputs of domestic origin.
These measures constitute subsidies under articles 3.1(b) and 3.2 of the SCM agreement.
Through their DVA requirements, they are contingent upon the use of domestic over imported goods. They are also against the provisions of the GATT 1994, as they constitute laws, regulations or requirements within the scope of that provision which, through their DVA requirements, accord less favourable treatment to imported goods than to like domestic goods.
They are also against TRIMs Agreement, as they constitute trade-related investment measures that are inconsistent with the national treatment obligation set out in Article III:4 of the GATT 1994.
Furthermore, the EV Passenger Cars Scheme appears to be inconsistent with Article I:1 of the GATT 1994, by according an advantage to products of certain countries that is not immediately and unconditionally extended to like products of all WTO Members.
“In addition, and as a consequence of the foregoing, the measures at issue appear to nullify or impair benefits accruing to China, directly or indirectly, under the cited agreements,” China said in its notification.
China looks forward to receiving India's reply and to agreeing on a mutually convenient date for the consultations. China reserves the right to refer to additional evidence during the course of consultations and in any future request for the establishment of a panel, it said.
