The recently signed India-UK Free Trade Agreement (FTA), finalized in London during Prime Minister Modi’s visit, is set to lower prices of premium British spirits like whisky and gin in India. As part of the deal:
Import duty on UK spirits will drop from 150% to 75% immediately
Over the next 10 years, it will be further reduced to 40%
This is being seen as a major step, especially for high-end liquor brands, which were previously too expensive for most Indian consumers due to high import taxes.
How Much Will Whisky Actually Cost?
Even though central import duties are being halved, liquor pricing in India is mostly controlled by state-level taxes—like excise duty, VAT, and cess—which will stay the same. This means the overall price reduction will be small, according to experts.
Here’s a sample price breakdown for a ₹5,000 bottle of imported Scotch whisky (based on Delhi pricing):
| Component | Current (150% Duty) | After FTA (75% Duty) | After 10 Years (40% Duty) |
|---|---|---|---|
| Base Import Price | ₹1,000 | ₹1,000 | ₹1,000 |
| Import Duty | ₹1,500 | ₹750 | ₹400 |
| Subtotal | ₹2,500 | ₹1,750 | ₹1,400 |
| State Taxes & Markup | ₹2,500 | ₹2,500 | ₹2,500 |
| Final Price | ₹5,000 | ₹4,250 | ₹3,900 |
| Savings | — | ₹750 | ₹1,100 |
However, industry insiders warn that state governments might raise their taxes, and retailers may keep some of the price benefits, meaning the actual savings could be just ₹100–₹300 per bottle in many states.
Industry Welcomes Move, But With Caution
The International Spirits and Wines Association of India (ISWAI) welcomed the duty cut, saying it would:
Encourage premiumisation of alcohol choices in India
Attract foreign investment
Help the hospitality, tourism, and retail industries
Increase state revenues due to higher volumes sold
ISWAI CEO Sanjit Padhi called the agreement a “historic moment” that will make premium liquor more affordable in India.
Will It Change Buying Habits?
Even if the actual price drop is small, the psychological impact could be strong. Lower import duty sends a message that imported liquor is becoming more accessible, not just a luxury for the elite.
This could lead to more demand in:
Urban middle-class markets
Duty-free stores
Premium hotels and bars
Final Thoughts
The India-UK trade deal won’t make Scotch whisky cheap overnight, but it sets up a long-term shift.
As duties decrease and competition grows, companies may introduce smaller bottles or better pricing to reach more Indian consumers.
So yes, whisky lovers can start celebrating—but the real party may take a few years to arrive.
