US Spoke in Solar Wheel:

September 15/2015 : India’s ambitious Solar Mission is facing serious odds. This, after the US put a spoke into its wheels by taking up the issue of governmental subsidies to the mission, and moving WTO’s trade court to stop this. A disputes court of the organisation has, the other day,asked India for compliance. Strangely, the US did this on India when American solar firms themselves get subsidy from their government.A case of double standard, for which successive US administrations are all too famous.

The Jawaharlal Nehru National Solar Mission, set in motion in 2010,had set a high target, namely to reach electricity to all households in the country, where one-third of the population still does not have access to it. This is despite the big talk of India streaming its way into a possible Super Power status in another few years’ time. Prime Minister Narendra Damodardass Modi has laid special emphasis on boosting alternative energy production with focus on solar energy. But now, despite his publicised good equations with the US President, Americans have managed to get the WTO to rule that either India stop the solar subsidies or face trade sanctions. It goes to say diplomacy is a hard-edged bargain. Damodardass has a lot to understand and much distance to cover. Personal equations matter very little when it comes to promoting national interests, especially for countries like the US. At stake were the interests of the US corporate entities supplying equipment for the solar projects in India as also elsewhere. Their contention was that the subsidies discriminated against foreign suppliers of solar components.

India set up the solar mission as part of its global commitment to the UN Action Plan on Climate Change, and aims at producing 100GW of power from solar source by 2022, as against its current electricity production of 255GW. Of this, over 70 per cent is produced from coal which affects the climate. The present Indian solar power production is of just 3GW, and total renewable energy input is a mere 20GW. Raising solar energy production to 100GW is a gargantuan task, and governmental support is vital. What has irked the US is the provision that was appended to the subsidies that certain components for the solar panels should be produced domestically, and not imported. Initially, the stipulation was only for solar cells and modules, which was acceptable to the US. When 'thin film technology' too was added to the domestic component requirement (DCR) list, which was where the US makes big money, the fight erupted in 2013, leading to the filing of a complaint by the US in WTO.

Fact is, US itself has DCR stipulations as also connected subsidies in its national renewable energy sector.

In a way, WTO cannot be faulted. It had issued a similar ruling against Canada, when Japan and the European Union filed a complaint of the same kind some time ago. But, the question now is, why discriminate when the US itself provides subsidies; and what good is coming out of Modi’s perceived good equations with the head of state in the US. And, Modi is set to take off for another US trip soon enough if only for a Facebook sponsored Town Hall meet. We all are aware that Zuckerberg of Facebook is doing this in return for his company getting the zero rating program of Internet.org in cahoots with Reliance for whole of this country.

India will have to find its way out of this WTO ruling. For one, it can legally challenge the order. But, uncertainties persist, and the solar mission will have a difficult time seeking to achieve its goal.Also, questions are raised as to how far India would go in fighting back the US. India is relying on hefty investments of the order of $100 billion to make a success out of the solar mission, and half that

money is expected from US investors. India has raised questions as to how US grants subsidies to its firms and objects to India doing the same. But, it has not gone to the extent of filing a formal complaint against the US at WTO.

Madison Square frenzies might whip up the mood back home and earn him US dollars in white for political expenses. However, what Modi should aim at during his upcoming visit is to get the Americans to take a more realistic stands on India vis-à-vis its trade and other deals. We doubt he has any such intentions.