Role of WTO in the India–America Trade War

Abstract

The growing interdependence of global economies has intensified trade relations as well as trade conflicts among major nations. The bilateral trade relationship between India and United States represents a significant component of the global trading system, characterized by both cooperation and periodic disputes. This study examines the role of the World Trade Organization in managing trade tensions between the two countries, often described as a “trade war” in a limited and episodic sense. The research adopts a qualitative and analytical approach based on secondary data sources, including WTO reports, policy documents, and trade statistics. The study focuses on four key parameters: tariff measures, export subsidy intensity, trade dispute frequency, and trade volume impact. The findings reveal that tariff escalations and export subsidies have been major sources of conflict, leading to multiple disputes under the WTO framework, particularly during the 2018–2020 period. The WTO’s dispute settlement mechanism has played a crucial role in providing a legal platform for resolving these conflicts, thereby preventing uncontrolled escalation and encouraging negotiated settlements. However, the study also highlights limitations in the WTO’s effectiveness, especially due to the Appellate Body crisis, which has weakened the enforcement of decisions. Despite recurring disputes, bilateral trade between India and the United States has shown long-term growth, indicating strong economic interdependence. Overall, the WTO acts as a moderating institution that stabilizes trade relations by promoting rule-based governance. The study concludes that strengthening WTO mechanisms and adapting them to contemporary trade challenges are essential for ensuring sustainable and balanced global trade relations.