Trade deal: Why Indian whiskey brands won’t lose sleep over US spirits

The market is currently dominated by Indian companies, followed by Scotch with a share of over 3 percent and Irish whiskey at 0.2 percent.

• US whiskey brands unlikely to impact Indian market due to import price rule
• American whiskey holds just 0.1 percent share in India's whiskey market
• Indian spirit makers' interests will be protected under the new trade agreement

Did our AI summary help?

Your favourite India whiskey brand is unlikely to face any heat from its US rivals after New Delhi agreed to open its markets for American wines and spirits under the interim trade agreement, according to a Times of India report.

Under the India-US trade deal, the domestic spirit makers will be protected by a minimum import price mechanism, under which sale of alcohol beverages below a floor price won’t be allowed, the report said. In addition, the share of US whiskey brands is very low.

As of now, American whiskey’s share stands at just 0.1 percent of the total Indian whiskey market, which sees sale of 229,000 cases of 9-litre bottles, the newspaper said.

The market is currently dominated by Indian companies, followed by Scotch with a share of over 3 percent and Irish whiskey at 0.2 percent.

Brewers Association of India’s director general Vinod Giri told TOI that most Bourbons and Tennessee whiskies appeal less to majority of the premium whiskey consumers. Moreover, price is not a major factor for customers as seen in the case of bottled in India Jim Beam, which sold at a price below locally-bottled Scotch whiskey, the report said.

This is why, Giri noted, tariff reduction on Bourbon won’t have any impact on the Indian market.

However, the industry is awaiting the details of the agreement, with New Delhi promising domestic players that there interests will be protected.

American wines, motorcycles, medical devices gain from India-US interim trade pact

Wine segment accounts for less than 0.5 percent of India’s alcohol market. Currently, the wine market is dominated by Australia.

India has permitted the import of wines, spirits and other alcoholic beverages, subject to a minimum import price, commerce and industry minister Piyush Goyal said, adding that duties and restrictions remain unchanged across several other categories.

Products such as groundnut, honey, malt, non-alcoholic beverages, essential oils, ethanol and tobacco have been kept outside the scope of any concessions, he said.

The remarks came at a press briefing following a joint statement issued by India and the US on February 7, in which the two countries agreed on a framework for an interim trade agreement. Under the proposed framework, tariffs on Indian exports are expected to be reduced to 18 percent.