UK & India: UK and India negotiate removal of 150% whisky export tariff

The UK and Indian governments have launched negotiations for a free trade agreement at an event in New Delhi, with the removal of the 150% whisky export tariff being a key priority, the Scottish Business Insider reported on January 12.

International Trade Secretary Anne-Marie Trevelyan will meet with her counterpart, Indian minister of Commerce and Industry Piyush Goyal, to formally start talks.

India is one of the world’s fastest-growing economies and a trade deal has the potential to almost double UK exports to India, boosting the total trade by as much as £28 bln a year by 2035, while increase wages across the UK by up to £3 bln.

Investment from Indian companies already supports 95,000 jobs across the UK.

UK Government Minister for Scotland Malcolm Offord hinted late last year in a parliamentary committee meeting that a future trade deal with India would “transform the whisky industry”.

The first round of negotiations is expected to start next week.

During her visit to India, Trevelyan will also co-chair a meeting of the UK-India Joint Economic and Trade Committee to review how businesses in both countries are benefiting from existing market access commitments under the UK-India Enhanced Trade Partnership agreed last May by the Prime Minister Boris Johnson and Indian Prime Minister Narendra Modi.

She is also expected to meet with Indian Foreign Minister Subrahmanyam Jaishankar, Finance Minister Nirmala Sitharaman, and Environment Minister Bhupender Yadav to discuss wider bilateral cooperation.

The UK will then plans to launch negotiations with Canada, Mexico and the Gulf and secure accession to the £8.4 trn Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) trade bloc.

Mark Kent, chief executive of the Scotch Whisky Association, said: “The new year offers new hope for reducing the longstanding 150% tariff on Scotch Whisky in India.

“Launching UK and India trade talks offers a golden opportunity to reach an ambitious tariff reduction in an early harvest deal that could grow Scotch Whisky exports to India by £1 bln over five years.

“Tackling the tariff and State level regulatory issues would open the market up to smaller producers who are effectively locked out by the substantial barriers to trade.”

Offord added: “India holds enormous potential for Scottish businesses as part of an ambitious new trade deal.

“On a recent visit to Mumbai, I saw first-hand how Scotland’s distilleries would benefit from the removal of tariffs as high as 150% on whisky; our thriving services sector would also receive a welcome boost.”

13 January, 2022