HOPE GOVT ENSURES SCOTCH WHISKY, BIO SPIRITS ARE NOT DUMPED AT LOW IMPORT PRICES: CIABC DG ANANT S IYER
HIGH TIME STATE GOVERNMENTS END ALL CONCESSIONS CURRENTLY EXTENDED TO BIO BRANDS: CIABC DG ANANT S IYER
NEW DELHI: CIABC believes that the historic FTA between India and the UK will further strengthen economic ties between the two nations across many sectors and lead to increased bilateral trade and investment. Alcoholic beverages were a key component of the FTA talks where the Indian Alcobev industry sought a level-playing field and ensured that its interests were safeguarded. CIABC welcomes phased tariff reduction over 7 years.
Though lowering of import duty on Scotch will help the domestic industry as Scotch used to produce blended products will also get cheaper, absence of “Minimum Import Price” (MIP) for spirits remains a major concern for the industry as it could lead to an influx of cheaper products. We hope the government will ensure that Scotch whisky and other spirits (bottled in origin) are not dumped at low import prices or routed through any other country at cheaper rates, which would hurt the YOY growth of the premium and luxury Indian Alcobev market.
CIABC feels that with the import duty being cut drastically, it is high time that a number of state governments end all concessions — such as lower brand registration fees, reduced excise duties, etc. — currently extended to BIO (bottled-in-origin) brands. This has created a situation where importing alcobev products is becoming cheaper than producing it in India.
Imported brands benefit from dual relief: first through lower customs duty under the FTA and second through state-level excise mechanisms that often cap MRP slabs for imported spirits more leniently than IMFL.
With lower import duties, it will now become even more economical for MNCs to import their products. State governments should withdraw any preferential treatment currently being given to imported products in spirits and wines, and end the discrimination against India-made alcoholic beverages.
The Government needs to ensure competitive neutrality between domestically produced IMFL and BIO products. In several states, BIO products benefit from lower fees, differential margins, or greater pricing flexibility even when competing in the same premium segments as Indian brands. Such asymmetries neither strengthen competition nor maximise state revenues. Parity-based excise design is essential for a healthy, investment-led market.
Concessions being given to BIO brands also go against the spirit of Prime Minister Narendra Modi’s mission of ‘vocal for local’ and ‘Make In India’. All countries protect and promote their domestic products. Why should some of our governments promote imported products at the expense of Indian-made products?
