Trump’s tariff war: Liquor industry protests as India slashes duty on imported bourbon

The Confederation of Indian Alcoholic Beverage Companies (CIABC) urged the government to introduce “stringent and effective measures” to prevent the dumping of imported spirits and to negotiate better international market access for Indian alcoholic products, which currently face several non-tariff barriers. Non-tariff barriers in the UK, for instance, have been a point of contention in India-UK trade negotiations.

During the talks, the industry had said that the UK has a stringent three-year maturation requirement for whisky, which blocks sales of Indian products in the British market. A representative from the Indian industry argued that whisky matures faster in India’s hot climate compared to the UK, making the requirement an unfair barrier to trade.

“The government needs to safeguard the interests of Indian liquor manufacturers when deciding on issues related to customs duty cuts and other concessions under FTAs. We have requested state governments to withdraw all excise concessions given to imported liquor, as the reduction in customs duties will further impact Indian products in both the spirits and wine categories. It will be a double whammy for Indian companies,” Anant S Iyer, Director General of CIABC, said in a statement.

Iyer added that Indian liquor manufacturers were “not opposed” to a reduction in import duty, though they have requested that the cuts be “phased” in over a period of 10 years.

“Countries should remove non-tariff barriers that prevent a vast majority of Indian products from being sold in Western markets. We also want these markets to recognise Indian whiskies on par with other global products,” Iyer said. He further said the industry needs protection due to the persistent threat of cheap imports in the spirits and wine sectors, which could erode the domestic industry that has painstakingly built a strong portfolio of premium offerings over the years.

“The beverage alcohol industry contributes over Rs 3 lakh crore to state government exchequers, in addition to revenue accruing to the Centre from customs duty and GST on a range of inputs. The industry also provides substantial employment and supports agricultural production,” he said.