Potential Pitfalls of Duty Cuts in Trade Deals for Domestic Spirits

The Confederation of Indian Alcoholic Beverage Companies (CIABC) has raised concerns regarding the future import duty cuts on wines in upcoming trade agreements. The organization believes that such concessions could threaten domestic wine makers as cheaper imports from regions like the EU, US, Australia, and New Zealand are likely to flood the Indian market.

The CIABC has urged the government to impose a minimum import price clause to deter the entry of low-cost, inferior-quality spirits and wines. The duty cuts already agreed upon under the UK-India trade deal has seen Scotch whisky tariffs being halved from 150% to 75%, with potential further reductions threatening the domestic premium whisky market.

Anant S. Iyer, the Director General of CIABC, emphasized the detrimental impact of similar concessions on domestic wine industries should they be extended to other international agreements. India is wary of providing extensive import duties relief on wines, though it has already granted such benefits to Australian wine under a recent trade pact.

(With inputs from agencies.)