India moves to resolve Scotch whisky tariff dispute
Commerce ministry officials assured liquor companies that bulk shipments qualify for the 75 per cent import duty under the UK trade pact.
The Indian government has taken steps to resolve a dispute regarding Scotch whisky imports under the India-UK Comprehensive Economic and Trade Agreement (CETA), according to a Reuters report cited by the Times of India.
During a closed-door meeting with industry executives on Monday, commerce ministry officials stated that New Delhi would honour the trade agreement in letter and spirit. Commerce secretary Rajesh Agrawal told attendees that steps are being taken to ensure the duty concession on bulk Scotch whisky is not impaired.
The dispute involves the reduction of import duty on Scotch whisky from 150 per cent to 75 per cent. While the agreement came into effect in July 2026, tax officials had informed liquor companies that the lower rate did not cover Scotch arriving in bulk containers.
Approximately 80 per cent of Scotch whisky sent to India arrives in bulk rather than in finished bottles. Indian manufacturers use these shipments to produce Indian-Made Foreign Liquor (IMFL) by blending Scotch with other ingredients.
The disagreement has affected companies including Diageo, Pernod Ricard, Radico Khaitan, and Allied Blenders and Distillers. Tax officials recently searched the offices of several firms and questioned executives regarding the eligibility of bulk imports.
The British government said it is working with New Delhi to resolve the matter, while the Scottish government has raised concerns. Scotch exports to India were valued at $335 million in 2024.