The recent trade agreement between the UK and India will halve tariffs on whisky into what is the world’s biggest export market for the drink.
Craft operations in other tipples are also now expecting to exploit the UK’s deal with the world’s fourth-largest economy.
Trade deal
The new trade deal halves tariffs on Scotch imported to India, from 150% to 75% with a further reduction to 40% in 10 years.
These figures do not include state tariffs which can be another 150%. Nevertheless, the trade deal has the potential to boost exports to India by £1bn over the next five years.
World’s largest market for Scotch
India is the world’s largest market for Scotch exports with 192 million bottles bought in 2024, nearly 14% of all exports to India.
UK distilleries have been facing a downturn as customers choose cheaper products. In 2024 the value of Scotch whisky exports fell nearly 4%. Whisky contributes to 3% of the Scottish economy.
For Diageo, the world’s biggest Scotch producer, India represents 6% of its 2024 net sales.
10% drop in prices
Industry experts such as Jason Holway of IWSR say the easing of tariffs is likely to lead to a price drop of 10% in India. It is not quite a game changer, nor is it to be sniffed at.
Smaller brands are now expected to start exporting to India, and pricier ones are set to increase their offering as prices become more affordable to India’s burgeoning middle class. And as new distribution channels are established, marketing spend will rise and demand will grow. I’ll drink to that.
