Groups concerned about the environment have long been skeptical of trade liberalization. From what I understand, they view pollution and the depletion of natural resources as the inevitable consequences of unregulated economic growth. But what if that growth is driven by trade in environmentally friendly products? Is trade still bad then? Apparently so.
The United States has attracted negative attention from a number of environmentalists by bringing a formal challenge at the World Trade Organization against Indian trade barriers on solar panels. India provides subsidies to developers of solar power plants only if they purchase solar cells from Indian manufacturers. This is called a “local-content requirement” and such schemes are generally illegal under WTO rules.
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