Tariff cuts on UK’s whiskies may serve as template for the proposed India-EU FTA

European commissioner for trade and economic security Maros Sefcovicin Brussels and india's minister for commerce Piyush Goyal after their meeting in Brussels on May 1.

India’s tariff concessions on whisky as part of the free trade agreement (FTA) with the United Kingdom may serve as a template for tariffs cuts on wines as part of the proposed pact with the European Union, one industry source has told Moneycontrol.

Through the FTA with UK, India has agreed to halve tariffs on whiskies from 150 percent to 75 percent once the agreement comes into force, followed by reducing the levy to 40 percent in 10 years.

The EU too has been pushing India for greater access for their wines, which currently face a 150 percent tariff. “The duty cuts for UK’s whisky through the trade deal can be the model to give concessions to EU’s ask for duty cuts on their wines, because that is a key area in the talks,” the industry source said.

Calls for tariff cuts are key, given that the EU is the world’s leading producer of wines. In 2023, it accounted for 44 percent of global wine-growing areas, over 60 percent of production and 48 percent of consumption. It is also the third largest agri-food sector in terms of exports, with 7.3 percent of agri food value exported in 2024. Read More

In the past, India has lowered tariffs on premium Australian wine exports under the interim trade deal with them.

India is currently negotiating trade deals with the EU, Oman, New Zealand, and the United States. The 11th round of negotiations for the proposed FTA between India and the EU is scheduled between May 12-16 in New Delhi. In February, India and EU agreed to ramp up talks for the proposed FTA, and close it by the end of 2025 to tide over impending troubles from tariffs. Read More

The decision was taken during European Commission president Ursula von der Leyen’s two-day India visit with a 27-member delegation in February. Both sides are also exploring an interim or early harvest trade agreement before a larger pact, as they attempt to quickly wrap up negotiations.

The EU is India's largest trading partner, accounting for 12.2 percent of Indian trade, ahead of the US (10.8 percent) and China (10.5 percent). The 27-country bloc is the second-largest destination for Indian exports after the United States.

India is EU’s ninth-largest trading partner, accounting for 2.2 percent of its total trade in goods in 2023, well behind the US, China and the UK.