The "Green" Trade War: Why China is Suing India at the WTO

The trade war between Asia’s two giants has moved from the border to the courtroom. On December 19, 2025, China formally requested dispute consultations with India at the World Trade Organization (WTO), alleging that New Delhi’s tariffs on Information and Communication Technology (ICT) products and subsidies for the solar power sector violate global trade rules. This complaint marks a significant escalation, coming just two months after Beijing challenged India’s Production Linked Incentive (PLI) schemes for EVs. China claims these measures are discriminatory "import substitution subsidies" designed to unfairly block Chinese goods from the Indian market.

The Context (How We Got Here)

This dispute is not an isolated incident; it is part of a calculated legal offensive. In October 2025, China filed a similar complaint against India’s PLI schemes for Electric Vehicles and batteries. Tensions flared further late in the year when India imposed anti-dumping duties on Chinese cold-rolled steel to shield domestic steelmakers. The December filing targets the heart of India's tech ambitions: the tariffs that forced companies like Apple to manufacture locally, and the subsidies nurturing a domestic solar industry to reduce reliance on Chinese panels.

The Key Players (Who & So What)

• Ministry of Commerce (China): The aggressor. Using the WTO’s rulebook as a weapon, Beijing argues that India’s "Atmanirbhar" (Self-Reliant) policies undermine fair competition, effectively demanding that India lower its digital and green energy drawbridges.
• Government of India: The defender. New Delhi views these tariffs and PLI schemes as essential tools for national security and economic sovereignty, necessary to break the stranglehold of Chinese imports on critical infrastructure.
• World Trade Organization (WTO): The referee. The 60-day consultation period has begun. If the two nations cannot agree—which appears likely—the WTO will form a dispute settlement panel, setting the stage for a landmark ruling on the legality of modern industrial policy.

The BIGSTORY Reframe

While headlines scream "Trade War," the deeper story is the "Green Protectionism Paradox." China is using the WTO—an institution built for free trade—to attack India’s Green Industrial Policy. The irony is palpable: China built its own global dominance in solar and EVs using the exact same playbook of subsidies and state support it now calls "illegal" when India uses it. This isn't just a legal dispute; it is a "Ladder-Kicking" Strategy, where the dominant player tries to use international rules to prevent emerging rivals from climbing the same ladder of state-led development.

Furthermore, the attack on ICT tariffs is an attempt to smash India’s "Tech Wall." India’s high tariffs on imported electronics successfully coerced global giants to set up factories in India. If China wins this case, it could force India to slash these tariffs, potentially reversing the "Make in India" smartphone success story and flooding the market once again with fully assembled Chinese tech.

The Implications (Why This Changes Things)

If the WTO rules against India, New Delhi faces a difficult choice: comply and dismantle the PLI architecture that underpins its manufacturing boom, or ignore the ruling and face retaliatory sanctions. This dispute puts the entire "China Plus One" strategy on trial. For Indian manufacturers in Gujarat (solar) and Tamil Nadu (electronics), the outcome will determine whether they continue to receive state protection or face a renewed onslaught of cheap Chinese imports.

The Closing Question (Now, Think About This)

If every major economy is now using subsidies to fight climate change and secure supply chains, is the WTO’s rulebook protecting fair trade, or just protecting the monopolies of early movers?

FAQs

Why did China file a WTO complaint against India in December 2025?

China requested dispute consultations with India at the WTO to challenge New Delhi's tariffs on Information and Communication Technology (ICT) products and subsidies provided to the solar power sector. Beijing alleges these measures discriminate against imported Chinese goods and violate global trade norms regarding national treatment.

What are the two major WTO disputes between China and India in 2025?

In late 2025, China initiated two distinct disputes:

• October 2025: Challenging India's PLI schemes for Electric Vehicles (EVs) and Advanced Chemistry Cell (ACC) batteries.
• December 2025: Targeting India's solar sector subsidies and import tariffs on ICT goods.

Did India ban Chinese steel imports in 2025?

India did not implement an outright ban but imposed anti-dumping duties on certain Chinese steel products, specifically cold-rolled steel, in late 2025. This was done to protect domestic steel manufacturers from being undercut by cheap imports, adding to the trade friction that led to the WTO complaints.

Sources

News Coverage

• Reuters – China files WTO case against Indian tariffs & subsidies
• Economic Times – China launches trade dispute against India over solar & IT goods
• NDTV Profit – China moves WTO urging India to correct telecom tariffs

Analysis & Context

• Business Standard – China challenges India's EV PLI schemes at WTO
• Arunachal Times – China requests WTO consultations with India