Moët, Jameson, Grey Goose: Your favourite liquor brands set to get cheaper under India-EU FTA

• India and EU conclude historic free trade deal after nearly 20 years of talks
• EU to slash tariffs on 99.5% of traded goods over seven years
• Tariffs on wines, spirits, cars, and machinery to be significantly reduced

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Amid rising global volatility, India and the European Union on Tuesday concluded what has been described as the "mother of all trade deals" in New Delhi. Addressing the media after bilateral discussions with European Commission President Ursula von der Leyen and European Council President António Costa at the historic Hyderabad House, Prime Minister Narendra Modi said the agreement was the biggest trade deal ever signed by India.

The free trade agreement, the outcome of nearly two decades of negotiations, will see the European Union slash tariffs on 99.5% of traded goods over a seven-year period. Tariffs will be reduced to zero on a wide range of Indian exports, including marine products, leather and textiles, chemicals, rubber, base metals, and gems and jewellery.

Among sectors of high consumer interest, alcoholic beverages will see significant tariff reductions. According to a factsheet released by the European Commission, tariffs on premium wines will fall to 20% from the current 150%, while duties on mid-range wines will be reduced to 30%.

Other alcoholic categories, including beer and spirits, will also benefit. Currently subject to tariffs of up to 150%, spirits will face a reduced duty of 40% once the FTA comes into force. Beer, which is particularly popular among younger consumers, will see tariffs cut to 50% from the existing 110%.

This marks the second major instance of alcohol pricing coming under scrutiny through a trade pact. Last year, India signed a free trade agreement with the UK, under which duties on British whisky and gin were reduced from 150% to 75%, with a further cut to 40% in the tenth year of the agreement.

Reacting to the development, the International Spirits and Wines Association of India (ISWAI), which represents premium alcoholic beverage companies-largely multinational firms-described the deal as a historic moment for the alcobev sector that paves the way for a more balanced and equitable trade environment.

The India-EU agreement is expected to double EU exports to India by 2032 by eliminating or reducing tariffs on 96.6% of traded goods by value, resulting in annual duty savings of about €4 billion ($4.75 billion) for European companies, according to the EU.

The accord will also open up India's tightly protected market, with tariffs on passenger cars set to fall from as high as 110% to 10% over five years, benefiting European automakers such as Volkswagen, Renault, Mercedes-Benz and BMW.

In addition, tariffs on a range of EU goods-including machinery, electrical equipment, chemicals, and iron and steel-will be reduced. Duties on wines will be cut immediately to 75% from 150% and gradually lowered to 20%, while tariffs on spirits will fall to 40%, the EU said.

"Europe and India are making history today," von der Leyen said in a social media post. "This is only the beginning."

Trade between India and the EU stood at $136.5 billion in the financial year ending March 2025. Formal signing of the agreement will take place after legal vetting, which is expected to take five to six months.