A day after India-UK FTA, Indian liquor companies allege discrimination against homegrown brands in Britain

NEW DELHI: Scotch and British gin makers may have been successful in gaining lower import duty in India following the FTA with UK, but local alcohol companies here are miffed, alleging discrimination against Indian brands when they are shipped to the UK.Local companies claim that the UK govt has prescribed “non-tariff barriers” to stop Indian brands from accessing the market “equally and fairly”, and these restrictions result in below-par sales and non-impactful operations.“The UK and even the European Union do not allow fair imports of most Indian-Made Foreign Liquor (IMFL) products into their markets due to non-tariff barriers related to maturation and ingredients. We only wish that the Indian govt had stood firm on the issue of non-tariff barriers,” said Anant S Iyer, Director General of Confederation of Indian Alcoholic Beverage Companies (CIABC) told TOI here.Giving details, Iyer said the UK govt has prescribed that to label a brand as whisky, an Indian company has to ensure that I’s whisky has been matured for at least three years, the same yardstick that the UK applies for brands produced and sold in their country.“However, this is an unfair ask. In the UK and EU, the weather is cold and it takes time to mature the spirit and thus the three-year mandate holds good. But in India, the maturation is much faster given the tropical climate that we have. A longer period of maturation, say for three years, will mean that around one-third of our spirit will evaporate due to the hotter climate which will not only result in losses but also impact the quality of the product.”“UK laws do not allow anything matured under three years to be labelled as whisky. Thus, we are forced to categorise our brands as ‘Indian spirits’. This description effectively keeps us out the broader whisky market in the UK and Europe, and thus customers do not buy our products. We would like to label our products as Indian Whisky or Indian Rum/Brandy and sell same in the UK/EU and allow the market and consumer to decide.CIABC is continuing to seek the govt’s support in taking up “the issue of discrimination” with the UK govt to ensure that Indian brands, which fiercely compete with the western products here, are allowed the same opportunity abroad.CIABC is now petitioning the govt that it take up “the issue of discrimination” with the UK govt to ensure that Indian brands, which fiercely compete with the western products here, are allowed the same opportunity abroad. “The govt has set an ambitious target of achieving $1 billion in exports from the Indian alcobev industry by 2030. However, without ensuring proper market access, it will be difficult to meet this target. Though Indian whiskies, rum, gins, wines, etc., have been winning accolades globally, the lack of removal of non-tariff barriers and absence of reciprocal market access will make this export target hard to achieve,” Iyer said.CIABC has also recommended the govt that it mandate a minimum import price (MIP) on Bottled-in-Origin (BIO) products coming in from Scotland to ensure that the Scotch whiskies are not imported to India at lower rates.“We hope that the govt will ensure that Scotch whisky and other BIO spirits are not dumped in India at low import prices or routed through any other country at cheaper rates. This will hurt the growth of premium and luxury Indian brands. To ensure guardrails are in place, the govt needs to utilise technology to monitor imports through continuous scanning of billing prices and GI tagging at ports of entry into India. Any deviation should be red-flagged and immediate action taken on anti-dumping grounds. A solution to address this would be the imposition of a minimum import price (MIP) on BIO products. In fact the Govt has incorporated MIP in the India -UK FTA on rum/brandy and other liquor products. The only exception on this count being Scotch Whisky/other whiskies/Gin originating from UK.”