China has filed a complaint with the World Trade Organization (WTO) against India’s solar photovoltaic subsidies, alleging that they provide an unfair competitive advantage to Indian companies and harm Chinese interests.

According to a Ministry of Commerce spokesman, China had submitted a request for consultations at the WTO about India’s subsidies for the solar sector.

China has alleged that India’s import substitution subsidies violate WTO obligations. The WTO prohibits such subsidies, the spokesman said.

He added that the complaint at the WTO is another step by China to safeguard the “legitimate rights and interests” of its domestic industries, following its complaint against India’s electric vehicle (EV) and battery subsidies. “We once again urge India to abide by its relevant commitments at the WTO and immediately correct its erroneous practices.”

This is the second dispute China has raised against India at the WTO over clean energy in two months. In October, China filed a complaint, claiming that India’s subsidies for EVs and batteries could be violating multiple obligations, including ‘national treatment,’ which are expressly prohibited by the WTO.

It had contended that under WTO rules, the national treatment obligation is a general prohibition on the use of internal taxes and other internal regulatory measures meant to protect domestic production.

China and India have on many occasions taken their trade disputes concerning clean energy to the WTO. Back in 2023, China raised a ‘Specific Trade Concern’ against India’s regulation that permits the deployment of only domestically manufactured solar modules for all projects across the country under the Approved List of Models and Manufacturers (ALMM) mandate. An aggrieved China considers ALMM as a trade barrier that effectively bars Chinese manufacturers from supplying to India.

However, the two countries have been on the same side of the fence on issues such as the European Commission’s Carbon Border Adjustment Mechanism, which seeks to impose tariffs on carbon-intensive products imported into Europe. Both China and India have expressed concerns over Europe’s carbon tax at the WTO.