China Files WTO Complaint Against India’s EV Subsidies, Accuses New Delhi of Copying Its Industrial Playbook

China has formally lodged a complaint with the World Trade Organization (WTO) against India, alleging that New Delhi’s electric vehicle (EV) and battery subsidy schemes violate global trade rules. The complaint marks a new flashpoint in the two countries’ economic rivalry — and underscores how India’s growing industrial ambitions are beginning to unsettle Beijing.

China’s WTO Challenge

According to China’s submission, India’s production-linked incentive (PLI) schemes and other subsidy programs that support domestic EV and battery manufacturing discriminate against foreign firms and breach the WTO’s “national treatment” principle, which requires equal treatment for domestic and foreign producers.

Beijing has accused India of using import substitution subsidies — incentives that encourage companies to replace imports with locally manufactured goods — which are prohibited under WTO norms.

Under WTO procedures, China has requested consultations with India, which is the first step in the trade dispute process before escalation to a full panel investigation.

This move mirrors similar steps China has taken against Türkiye, Canada, and the European Union, each of which has introduced industrial policies to bolster domestic green technology sectors.

Why China Is Uncomfortable

Analysts say Beijing’s frustration stems from India’s growing use of industrial policies that resemble China’s own development model — a strategy built on subsidies, domestic capacity-building, and state-supported industrial champions.

India’s EV policies and PLI schemes have significantly boosted local manufacturing, drawing major investments from global and domestic companies. These programs aim to reduce dependence on imports and foster homegrown technological capacity in strategic sectors such as clean energy, semiconductors, and electric mobility.

From China’s perspective, India’s success in building a competitive EV ecosystem could threaten its long-held dominance in global supply chains.

Irony in Beijing’s Objection

Observers have called China’s WTO action deeply ironic, given that its own industrial rise was fueled by decades of state subsidies, cheap credit, and export-driven protectionism.

For years, Beijing’s aggressive use of government support helped Chinese companies dominate industries like solar panels, batteries, and EVs — often overwhelming foreign competitors through sheer scale and cost advantage.

Now, with India applying a similar strategy, albeit more cautiously and transparently, China appears uneasy about facing competition on familiar turf.

China’s EV Market Pressure

China’s own EV manufacturers are facing domestic overcapacity, shrinking profit margins, and intense price wars, forcing them to look overseas for growth.

India, now the world’s third-largest auto market, represents a critical destination for expansion — but policies favoring domestic players could limit access for Chinese companies.

“China’s complaint isn’t just about legal principles — it’s about losing strategic space,” analysts say. “India is no longer just a consumer market; it’s becoming a manufacturing competitor.”

India’s Strategic Response

India has made clear that self-reliance in strategic industries is central to its economic policy. The government views sectors like EVs, batteries, and semiconductors as key to national security and long-term energy independence.

The PLI scheme, offering significant incentives to local manufacturers, has already begun attracting major investments from companies such as Tata, Ola Electric, and Reliance Industries, positioning India as an emerging EV hub.

Global Implications

China’s WTO complaint is not merely a bilateral issue — it highlights the growing friction over green technology subsidies worldwide. As nations compete to secure dominance in clean energy and mobility, trade disputes are likely to intensify.

Experts say the case underscores the beginning of a new era in global industrial competition, where developing nations like India are increasingly willing to play by rules that China once set for itself.

Conclusion:

While the WTO process may take months or even years to conclude, Beijing’s complaint is a clear acknowledgment of India’s growing manufacturing momentum.

For New Delhi, China’s discomfort might be the strongest validation yet that its industrial strategy is working — and that India is finally emerging as a credible challenger in the global manufacturing race.