China files complaint at WTO against India’s subsidy on electric vehicles and batteries

China, on Wednesday, lodged a complaint at the World Trade Organisation (WTO) against India, claiming that India’s subsidies for electric vehicles and batteries breach international trade norms.

According to Commerce Secretary Rajesh Agrawal, the ministry will review China's submission to the WTO. 

Citing a confirmation by an official, CNBC TV reported that China has also lodged a similar complaint against the EU, Turkiye and Canada.  "They have sought consultations with India," the official said, as per the report.

According to WTO regulations, the first step in the dispute resolution procedure is to seek consultation.

The EU may ask the WTO to form a panel to decide on the matter if the requested consultation with India fails to provide a suitable resolution.

Right now, China is India's second-largest trading partner, though India’s exports to the country have declined by 14.5% to $14.25 billion in 2024-25 from $16.66 billion in the previous fiscal year. However, the imports from China in 2024-25 have reached $113.45 billion, marking an increase of 11.52% from the previous year’s $101.73 billion. Therefore, India's trade deficit with China has widened to $99.2 billion during 2024-25.

Earlier, as per The Economic Times, the Indian government is planning to roll out a National Critical Mineral Stockpile (NCMS) programme to make the rare earth elements available in the country and to boost domestic production.

The manufacturing of wind turbines, electric cars, and other advancements in green energy technology depend on these rare earth elements. This action is well-suited for India, given China's intention to ban the export of these components.

These rare earth minerals are essential for the production of electric vehicles, wind turbines and other green energy technology developments. This move may potentially turn out in India's favour after China decides to impose restrictions on the export of these elements.