Top commerce ministry officials will hold closed-door discussions on Monday with domestic and foreign liquor executives to address the brewing tariff dispute. While an agreement implemented in July lowered import duties from 150% to 75%, authorities clarified that the reduction does not apply to bulk Scotch whisky. Domestic producers, including the Confederation of Indian Alcoholic Beverage Companies, argued in an October 27 letter that this policy directly undermines the "Make in India" initiative. Meanwhile, the Scottish government and British officials have intervened by raising the issue directly with New Delhi.
Key points
Excluding bulk imports from tariff cuts threatens domestic bottlers by creating an incent…: Excluding bulk imports from tariff cuts threatens domestic bottlers by creating an incentive to import finished foreign goods.
Major liquor companies represented by the International Spirits & Wines Association of In…: Major liquor companies represented by the International Spirits & Wines Association of India warn the move could undermine the trade deal.
Both the British government and the Scottish government have engaged directly with New De…: Both the British government and the Scottish government have engaged directly with New Delhi to address the tariff disagreement.
Sources checked by our analysis pipeline: 1
In the first major dispute linked to a historic India-UK trade pact implemented in July, New Delhi has told major companies that bulk Scotch imports are not eligible for the tariff reduction to 75% from 150% agreed in the deal.
The International Spirits & Wines Association of India, a group representing Pernod and Diageo, has privately warned New Delhi that the move to exclude bulk Scotch imports could undermine the pact.
The Confederation of Indian Alcoholic Beverage Companies (CIABC) has now joined the protest by flagging a hit to domestic manufacturing, according to an October 27 confidential letter to the government that Reuters is reporting for the first time.
Around 80% of Scotch whisky imports from Britain by volume arrive in bulk to be used to make popular brands, and India's $65 billion alcohol industry had hoped the cut in tariffs would bolster business.
Top Indian commerce ministry officials will on Monday hold closed-door talks with several senior executives of foreign and domestic liquor companies to discuss the issue, said the four people who have direct knowledge of the meeting.
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