global.json paths resolves SDK but runtimes from additional paths are not visible to the host

[JakeRadMSFT]

Description

The global.json paths property (new in .NET 10) correctly resolves the SDK from a local directory, but runtimes installed in that directory are not discovered by the host for test execution or dotnet --list-runtimes.

This affects repos like dotnet/aspire where restore.sh installs multiple .NET runtimes (8.0, 9.0, 10.0) into a local .dotnet directory and global.json uses "paths": [".dotnet", "$host$"] to point to them.

Reproduction

1. Have a system-wide .NET install at /usr/local/share/dotnet with only .NET 10.0.3
2. In a repo, run restore.sh which installs .NET 8.0.21, 9.0.10, and SDK 10.0.103 into a local .dotnet directory
3. global.json has:

   "paths": [".dotnet", "$host$"]

4. From the repo root, run dotnet --version -> 10.0.103 (correct, resolves from .dotnet)
5. Run dotnet --list-sdks -> shows SDKs from both .dotnet and /usr/local/share/dotnet (correct)
6. Run dotnet --list-runtimes -> only shows 10.0.3 from /usr/local/share/dotnet -- the 8.0.21 and 9.0.10 runtimes in .dotnet are missing
7. Running a test project targeting net8.0 via the VS Code Test Explorer fails:

   You must install or update .NET to run this application.
   
   App: .../artifacts/bin/Aspire.Hosting.DotnetTool.Tests/Debug/net8.0/Aspire.Hosting.DotnetTool.Tests
   Architecture: arm64
   Framework: 'Microsoft.NETCore.App', version '8.0.0' (arm64)
   .NET location: /usr/local/share/dotnet
   
   The following frameworks were found:
     10.0.3 at [/usr/local/share/dotnet/shared/Microsoft.NETCore.App]
   

Expected Behavior

When running tests from the VS Code Test Explorer (or via terminal), runtimes installed in the paths directories from global.json should be discoverable, so that test projects targeting net8.0/net9.0 can execute without manually setting DOTNET_ROOT.

Actual Behavior

Only runtimes from the host's own install location (/usr/local/share/dotnet) are found. The paths feature affects SDK resolution but not runtime resolution when tests are launched.

Workaround

Launch VS Code using the repo's start-code.sh script, which sets DOTNET_ROOT and PATH to point to the local .dotnet directory. Alternatively, manually set:

export DOTNET_ROOT=/path/to/repo/.dotnet
export PATH=$DOTNET_ROOT:$PATH

Environment

• macOS 14.8, arm64
• VS Code (latest)
• System .NET: 10.0.3 at /usr/local/share/dotnet
• Local .dotnet: SDK 10.0.103, runtimes 8.0.21, 9.0.10, 10.0.3
• global.json paths: [".dotnet", "$host$"]
• Repository: dotnet/aspire

[JakeRadMSFT]

Installing the 8.0 and 9.0 runtimes globally (to /usr/local/share/dotnet) via dotnet-install.sh resolved the test execution failures. This confirms the issue: runtimes installed in the local .dotnet directory referenced by global.json paths are not discovered by the host at runtime — only runtimes in the system install location are found.

[SubhamBurnwal]

For me the SDKs are installed at ~/.dotnet too. Using dotnet --info lists all runtimes but no SDKs, and Workspace Requirements keeps complaining that SDK is not found even after a successfull install..