A long-simmering solar panel trade spat heated up Monday when the Obama administration launched a World Trade Organization complaint over Indian local-content requirements.
U.S. Trade Representative Michael Froman said the Indian policy discriminated against foreign firms, including those in the U.S., by requiring solar products to be domestically sourced.
"These unfair requirements are against WTO rules, and we are standing up today for the rights of American workers and businesses," Froman said.
The WTO filing, which follows a similar February 2013 action, is a step in a path toward possible sanctions.
India enacted its local-content policy as a move to develop a domestic solar industry, seeing it as a means for economic growth while also plugging gaps in its shaky and underserved electricity markets. Several environmental groups have pushed the White House to abandon WTO action in hopes of spurring that development.
The Obama administration has argued the Indian policy would stifle growth in the solar industry and reduce U.S. exports. Indian imports of U.S. solar kit amounted to $119 million in 2011, before the local-content requirements took effect, according to Bloomberg.
India plans to dispute the complaint, as it argues U.S. solar panel makers still have access to most Indian markets.
“We will give a reply,” Tarun Kapoor, joint secretary at the Ministry of New and Renewable Energy, told Bloomberg. “Most solar projects in India are allowed to import. We have sufficient quantities open for competition.”