New Delhi: The ongoing trade war between the US and China carried over to the World Trade Organisation (WTO) on Wednesday as the Donald Trump administration called out Beijing over its alleged alleged trade protectionism while demanding a “reckoning”.

Analysts say that the new level of aggression displayed by the United States should give pause to Indian policy makers as New Delhi is due for another trade policy review at the Geneva-based multilateral trade body next year.

Significantly, India had got a pat on its back for trade policy reforms during its previous review in 2015.

The trade policy review allows members to put the overall trade and economic policies of a country under the scanner. The trade policies of developing countries are taken up for review every four years while developed ones face similar scrutiny every two years.

In a report submitted ahead of the three-day review, China insisted it had "been a strong advocate for free trade" since joining the WTO in 2001 and had "comprehensively fulfilled its commitments."

But US ambassador Dennis Shea, who was among the first to speak at the closed-door review, hit out at China, saying it had exploited its membership to take advantage of other nations and that Beijing's misconduct could ruin the WTO if not checked.

China's failure to fully embrace the open, market-oriented policies on which this institution is founded must be addressed, either within the WTO or outside the WTO, Shea said, adding this reckoning can no longer be put off.

If the WTO is to remain relevant to the international trading system, change is necessary, Shea argued.

The comments followed President Donald Trump's administration’s threat of fresh tariffs on another $200 billion in Chinese goods and which Beijing has vowed to retaliate to.

The US ambassador claimed that China provides massive, market-distorting subsidies and other forms of state support to its domestic industries.

He noted that while WTO rules permit some government support for national industries under specific circumstances, the Chinese approach results in "skewing the playing field against imported goods".

Trump has openly targeted India’s trade policies and high import tariffs, especially for Harley Davidson motorcycles, as the US trade deficit with the latter remains staggeringly high.

"The US goods trade deficit with India was $22.9 billion in 2017, a 5.9% decrease ($1.4 billion) over 2016," said the National Trade Estimate 2018 released by the US trade representative (USTR).

Trade deficit with India remains a sore point for Trump administration, which is insisting on full reciprocity in trade relations.

Trump has been venting his outrage at US' high trade deficit at public foras. “We’re like the piggybank that everybody is robbing,” Trump said recently while addressing a press conference in Canada’s Quebec City at the conclusion of the G7 summit.

After successfully challenging India’s procurement policy for solar equipment at the WTO, the US has targeted India’s export subsidy regimes.

In March this year, the US complained to the WTO dispute settlement body against India’s export subsidy regimes.

Specifically, the US has sought WTO consultations with India over the latter’s export subsidy programmes – Export Oriented Units (EoUs) Scheme and sector-specific schemes including the Electronics Hardware Technology Parks Scheme, Special Economic Zones (SEZs), Export Promotion Capital Goods Scheme and a Duty Free Imports for Exporters Programme.

Consultations are the first step in the resolution of disputes at the WTO. If the US is not satisfied with India’s response, the WTO will set up a panel to hear the case.

The US has claimed that these apparent export subsidies provide financial benefits to Indian exporters that allow them to sell their goods more cheaply to the detriment of American workers and manufacturers.

India provides exemptions from certain duties, taxes and fees that benefit numerous Indian exporters, including producers of steel products, chemicals, pharmaceuticals, textiles and information technology products, Robert Lighthizer, the USTR, said while explaining allegations.

“These export subsidy programmes harm American workers by creating an uneven playing field on which they must compete,” claimed Lighthizer.

“USTR will continue to hold our trading partners accountable by vigorously enforcing US rights under our trade agreements and by promoting fair and reciprocal trade through all available tools, including the WTO,” Lighthizer added.

The Trump administration has also ordered a review of India’s compliance with 15 conditions outlined by the Congress for availing concession tariffs in the US market under Generalised System of Preferences (GPS).

After failing to secure exemption from US’ protectionist tariff on steel and aluminum products, India has joined the European Union and China in hitting back at the US with the announcement of additional import duties on 29 American products including apples, almonds, walnuts, pulses and shrimp.

New import duties will hit US exports worth $235 million when they come into effect on August 4.

Besides announcing retaliatory tariffs, India has also complained to the WTO against US protectionist import duties for steel and aluminium products.

India told the multilateral trade body that the US duties of 25% and 10% on imports of steel and aluminium products respectively, are inconsistent with provisions of the WTO's General Agreement on Tariffs and Trade (GATT) 1994 and of the Agreement on Safeguards.

The Trump administration, citing security concerns, levied additional import duty on certain steel products and aluminium products in March.

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