Indian drinks companies are sounding alarms over a forthcoming UK–India Free Trade Agreement (FTA) that could dramatically cut import duties on Scotch whisky and gin—from the current 150% to 75% immediately, and down to 40% over ten years.
While this reduction is poised to boost UK spirits exporters and offer consumers more affordable choices, Indian producers fear their market share—especially in premium segments—could be undercut .
Major Scotch exporters such as Diageo are preparing to pass on tariff savings, which could translate to price cuts of around 20–30% on select bottles.
Experts predict India’s airport duty‑free retailers may shift focus toward boutique imported spirits or local premium brands to stay competitive .
Indian alcohol stocks have already reacted—shared from firms like Som Distilleries, Radico Khaitan, and Globus Spirits fell by up to 5% amid investor concerns .
Domestic producers stress the need for minimum import price rules and non‑tariff protections to curb dumping, a demand reportedly left out of the final deal.
India currently leads the world in Scotch volume imports—about 192 million bottles sold in 2024—but holds less than 3–4% market share due to high taxes. Lower duties could accelerate that trend .
While the full FTA is expected to be signed imminently and take effect within a year , its impact could reshape India’s alcohol market—providing new openings for UK gin and whisky, but squeezing local distillers unless further protections or adaptations are made.