In a new development that could impact global trade relations, China has filed a formal complaint against India at the World Trade Organization (WTO), accusing New Delhi of offering unfair subsidies for electric vehicles (EVs) and batteries.
China Alleges Violation of WTO Rules
According to China’s Ministry of Commerce, India’s EV subsidy measures violate WTO obligations, including the principle of “national treatment”, which requires member nations to treat imported and domestic goods equally.
Beijing claims that the subsidies encourage domestic manufacturing and act as import substitution measures, which are prohibited under multilateral trade rules.
Trade Tensions Amid Efforts to Normalize Relations
The complaint comes as China looks to boost exports of electric vehicles to India, even as both nations attempt to restore normal diplomatic ties after a five-year freeze following the Eastern Ladakh border standoff.
Industry experts believe that India’s large and growing auto market is seen by Chinese EV makers as a key opportunity for global expansion.
India’s Response to the WTO Complaint
When asked about China’s filing, Commerce Secretary Rajesh Agrawal stated that the government will review the details of the complaint before responding.
An official familiar with the matter added that China has also lodged similar complaints against Türkiye, Canada, and the European Union.
“They have sought consultations with India,” the official said. “Seeking consultation is the first step in WTO’s dispute settlement process.”
Under WTO procedures, both nations will first engage in bilateral consultations to attempt a resolution. If no agreement is reached, the matter could proceed to a WTO dispute panel for a formal ruling.
Experts suggest that while the case could take months to resolve, it underscores increasing trade friction in the global EV market, where nations are competing for leadership in clean mobility technologies.
Here are some Chinese EV / battery companies operating in India (or planning to) that could be affected by India’s subsidy policies and the WTO complaint
BYD (China)
BYD has been selling EVs in India — models like Atto 3, SEAL, SEALION 7, eMAX 7. They currently import most models as Completely Built-Up (CBU) units rather than local manufacture
SAIC Motor via MG Motor (SAIC / JSW MG Motor India)
MG Motor is partly owned by SAIC (a major Chinese automaker), though now in a joint venture with JSW Group in India.
