India-UK CETA: Scotch whisky imports to get cheaper now with tariffs halved to 75%
Under the agreement, India will immediately reduce tariffs by half to 75 per cent, and then to 40 per cent over ten years, once the deal is ratified domestically by the two countries.
Scotch distillers in the UK have welcomed the reduction in tariffs, which will give them greater access to the world's biggest whisky market by volume. Whisky was the UK's fifth-largest export product to India in 2024-25, valued at roughly $260 million.
'The deal will support long term investment and jobs in our distilleries in Speyside and our bottling plant at Kilmalid and help deliver growth in both Scotland and India over the next decade,' said Jean-Etienne Gourgues, chairman and CEO of Chivas Brothers, the firm behind popular whisky brands such as Chivas Regal and Ballantine's.
India's domestic alcoholic beverage industry, however, has flagged potential dumping concerns with the reduction in tariffs.
'Though lowering of import duty on Scotch will help the domestic industry—as Scotch used to produce blended products will also get cheaper—we hope that the government will ensure that Scotch whisky and other spirits (BIO-bottled in origin) are not dumped at low import prices or routed through any other country at cheaper rates, which would hurt the YOY growth of premium and luxury Indian brands,' said Anant S Iyer, director-general of the Confederation of Indian Alcoholic Beverage Companies (CIABC), hours before the full text of the agreement was made public.
To counter dumping, Iyer said the industry had recommended to the government to introduce MIP rules for scotch. However, the agreement does not impose any such requirements on scotch imports.
'With the import duty being cut drastically, it is high time that a number of state governments end all concessions—such as lower brand registration fees, reduced excise duties, etc.—currently extended to BIO brands,' Iyer said.
'This has created a situation where importing Alcobev products is becoming cheaper than producing it in India. With lower import duties, it will now become even more economical for MNC's to import their products. State governments should end all discrimination against India-made alcoholic beverages,' he added in a media note.
Iyer also flagged lack of market access for Indian-made foreign liquor in the UK and EU due to non-tariff barriers related to maturation and ingredients. 'Though Indian whiskies, rum, gins, wines, etc., have been winning accolades globally, the lack of removal of non-tariff barriers and absence of reciprocal market access will make this export target hard to achieve,' he said.
While tariffs on Indian exports of beverages, spirits, and vinegar have been eliminated entirely, non-tariff barriers are likely to remain.
Opening up the Indian market to foreign liquor has been a contentious issue in trade talks, including those ongoing with the US and the EU. Earlier in February, when the government had slashed duty on bourbon whisky – a key US export – from 150 per cent to 50 per cent, the domestic industry urged states to withdraw all excise concessions given to imported liquor, arguing that the customs duty cuts would harm Indian products in both the spirits and wine categories.
Aggam Walia is a Correspondent at The Indian Express, reporting on power, renewables, and mining. His work unpacks intricate ties between corporations, government, and policy, often relying on documents sourced via the RTI Act. Off the beat, he enjoys running through Delhi's parks and forests, walking to places, and cooking pasta. ... Read More
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