The Confederation of Indian Alcoholic Beverage Companies (CIABC) has raised concerns over potential import duty reductions on wine in future free trade agreements (FTAs), warning that concessional tariffs on imported wines from the EU, US, Australia, and New Zealand could flood the Indian market, putting domestic producers at risk.
CIABC has urged the government to impose a minimum import price clause to prevent the influx of low-cost and low-quality bottled spirits, bulk wines, and bottled wines. The industry body fears that duty reductions similar to those granted on Scotch whisky under the India-UK FTA could negatively impact Indian wine manufacturers.
Under the India-UK trade agreement, India agreed to reduce duties on UK whisky and gin from 150% to 75%, with a further reduction to 40% over ten years. While India has not provided duty concessions on British wines, CIABC warns that similar reductions for wines from other countries could place undue pressure on domestically produced quality wine brands.
India has already granted duty concessions on wines to Australia under a trade pact that came into effect on December 29, 2022, reducing tariffs on premium imported wine from 150% to 75%. The main wine-producing states in India, including Maharashtra and Karnataka, could face stiff competition if further duty reductions are introduced.
CIABC Director General Anant S Iyer emphasized the need for protective measures, stating that opening the Indian market to lower-priced wine imports could harm local producers and disrupt the industry. The organization continues to advocate for policies that safeguard domestic businesses while balancing international trade commitments.
