India has joined the United States and 13 other economies in a joint initiative aimed at addressing structural excess capacity and production, as concerns grow over market distortions affecting global trade and domestic industries.
The 15 participating economies signed a joint ministerial statement following discussions among G20 Trade Ministers in Milwaukee, Wisconsin. The statement calls for countries to address excess production and end non-market policies and practices that distort markets and contribute to overcapacity.
The participating economies include India, the United States, Argentina, Australia, Canada, the European Union, France, Germany, Italy, Japan, the Republic of Korea, Mexico, Poland, Türkiye and the United Kingdom.
The statement highlights structural excess capacity as a growing challenge for the global economy. The participating countries said persistent overproduction can distort prices and production patterns, discourage market-based investment, restrict competition and make domestic industries more vulnerable.
The initiative initially focuses on several key manufacturing sectors, including automobiles and electric vehicles, batteries, chemicals, foundational semiconductors and solar panels. The countries plan to cooperate through dedicated sectoral platforms to examine excess production and develop measures to address its impact.
India’s participation comes after Commerce and Industry Minister Piyush Goyal emphasized during the G20 Trade Ministers’ meeting that concerns over excess capacity should be addressed through a WTO-compliant and evidence-based approach. India has also stressed the importance of avoiding measures that unfairly place the burden of global trade adjustments on developing economies.
The participating economies said excess capacity can undermine domestic production, affect employment, discourage new investment and weaken market-based competition. They also warned that excessive dependence on a single source of production can increase economic vulnerabilities and expose trading partners to supply disruptions.
The countries have agreed to share non-confidential information and data on structural excess capacity, its impact on identified sectors and measures being taken to mitigate its effects. Technical-level discussions are expected to continue as the participating economies develop a framework for future cooperation.
The initiative marks a broader effort among major economies to coordinate their responses to trade distortions while protecting domestic industries and workers. The participating countries also invited other economies to join the discussions and contribute to efforts aimed at strengthening market-oriented competition.
