can someone explain to me how EU/US can heavy handedly protect their own agriculture and not violate the same rules? How is energy infrastructure not part of the same exemptions (assuming that those exist)?
Short version: Agriculture is one of the classic areas where countries usually said "no, we want to be independent, all the talk about free markets aside" .. That was the case when GATT[1] was still active (a framework, which built the base of the WTO), then came the Uruquay round[2] which established the WTO and stated that we now really, really have to find a way to include agriculture, which lead to the Doha round that ran since 2001 and more or less broke down in 2007/2008 - mainly over the issue of agricultural protection. Since then, nothing happened[3].
IMO it makes quite a bit of sense to exclude a few areas from enforced free trade. Otherwise we could as well argue that countries must allow a free market for acquiring military services. The thing is, it's silly to only do this for agriculture. There's a few areas that are vital for a nation to have some sense of independence, and allowing the protection of energy infrastructure is certainly one of them.
Don't get me wrong though, I'd prefer a world without the need for nation states and borders - but as long as we do have them IMO some of these international organisations are overstepping, and WTO is near the top of that list.
You need to be a pretty big country with a wide variety of natural resources to be truly independent (for instance, your "independent" agriculture is only independent if you have domestically produced fuel, fertilizer and machinery, etc. etc.) In today's world I think it's pretty tough (how many countries have their own chip fabs and how many don't? Chips go into a whole lot of products indirectly, etc.)
Of course having to protect this very wide range of domestic industries to maintain true independence will result in a huge loss of economic efficiency; so even if it is done right (without an "oops, we forgot the bit about the fertilizer" issue), not only do you have to be a rather large country with a lot of resources, you also have to accept a significantly lower standard of living and a degree of backwardness.
How much it helps I'm not sure; Britain for instance managed to feed itself during WWII even though it relied on its navy for food shipments and of course its cargo ships were constantly attacked. Certainly it did better than it would without a strong navy but with an independent domestic agriculture, since it would have been invaded.
On the other hand, presumably importing vitally important things without exporting vitally important things in return might put you in a bad bargaining position in international politics in times of peace, and maybe then domestic industries making sure that you can survive without imports are helpful; though even that doesn't seem like a huge problem unless you're importing from a cartel (and even very powerful cartels sometimes break down, the way OPEC did recently.)
As to agriculture - I sincerely think it's protected because producers simply bribe the people in the government; there was even research that the more concentrated and bigger ag producers are in a country, the more protected they are (even though a lot of the nominal arguments for protection are much stronger with many small producers than with few large ones typically employing fewer people), though I didn't look deeply into it and perhaps the researcher was biased by expecting this conclusion.
I agree with pretty much all you wrote - but I also don't think it's an actual counterargument. I never wrote that nation states should try to be fully independant as that is either futile or highly inefficient. However what India shows here is IMO a good example of a middle ground - you don't have to create everything from scratch, but it might be healthy to just mandate some percentage of vital infrastructure to be domestic, just as a reinsurance for when things go sour.
I dunno, you have to look at the cost side of these things and I'm not qualified in this instance. AFAIK India still protects its handloom manufacturers which IMO is madness cost-wise, but of course there's merit into looking at it on a case by case basis. I think the trouble with protectionism is you might end up subsidizing an inefficient domestic industry indefinitely; and I don't think "reinsurance" is a valid argument most of the time (there's usually enough sellers whom you can buy from even when things are very sour, and not having lost money on inefficient domestic production will keep you rich enough to afford it when things go sour), the valid argument IMO is you want to have a Korean auto company and you doubt that the first few cars it'll make will be able to compete with imported cars so you protect it. But what made this work great in Korea but not so great in India (which AFAIK produced pretty bad cars for internal market under similar protections for many decades) I'm not quite sure.
America believes in free trade as long as they are able to crush the competition like a bug even before it gets started off the ground.
If you can have local producers that have 8% market share, then they might actually have a sliver of a chance to survive and compete in the market place, and thats unacceptable. Yep, free and fair.
When South Africa (where I live), violated trade rules and put up barriers to US chicken imports, the US retaliated with barriers to the importation of some SA goods into the US. Eventually, SA gave in and removed the barriers.
IMHO Free trade of commodities (food, solar cells etc.) is a good thing.
So what you're saying is that without a local content requirement India is incapable of making competitive solar cells. I don't believe that's true. I think the local content requirement was simply a gift to politically well connected Indian firms. The Indian people should be thanking the WTO in this case, that rather than serving the interests of the crony capitalists, the interests of the people are being served.
Few countries have been damaged as much by protectionism as has India, and fewer have had such great gains by its gradual elimination.
Until the US sues them and the WTO rules against them. http://in.reuters.com/article/usa-india-solar-idINKCN0QV2FD2...