British government believes that the 'bold new deal' would put UK businesses at the front of the queue to supply India's growing middle class, with Scotch whisky set to benefit
Scotch whisky producers of the United Kingdom are in high spirits after India and UK launched negotiations on an ambitious Free Trade Agreement (FTA) on Thursday.
The deal between the two countries could bring huge benefits for Scotch whisky producers, as the Boris Johnson government is striving to slash duties of up to 150% on whisky exports, offering a boost to distilleries and the whole spirits industry.
Already hoping that the new year will reduce the longstanding 150% tariff on Scotch Whisky in India, the producers raised a toast as Minister of Commerce and Industry Piyush Goyal and UK's International Trade Secretary Anne-Marie Trevelyan formally started talks on the deal in New Delhi yesterday.
With India being one of the world's biggest and fastest-growing economies, the British government believes that the 'bold new deal' would put UK businesses at the front of the queue to supply India's growing middle class, with Scotch whisky set to benefit.
"Launching UK/India trade talks offers a golden opportunity to reach an ambitious tariff reduction in an early harvest deal that could grow Scotch Whisky exports to India by £1 billion over five years," said Mark Kent, the Chief Executive of the Scotch Whisky Association, the trade body that represents the Scotch Whisky industry.
Kent stated that tackling the tariff and state-level regulatory issues would open the market up to smaller producers who are effectively locked out by the substantial barriers to trade.
"Improved market access for Scotch would enable an increasing number of Indian consumers to enjoy our premium product. It would also be good for our industry and Indian government tax revenues – a win-win for all," he added.
Britain sees the deal with India as being a big step forward in the UK's strategy to refocus trade on the Indo-Pacific, home to half of the world's population and 50% of global economic growth.
A new economic partnership with India, alongside UK membership of the massive Asia-Pacific trading bloc Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), will create a pillar in the region supporting free and fair trade.
Home to 1.4 billion consumers and one of the world's fastest growing economies, India holds enormous potential for Scottish businesses as part of the new trade deal.
"On a recent visit to Mumbai, I saw first-hand how Scotland's distilleries would benefit from the removal of tariffs as high as 150% on whisky. Our thriving services sector would also receive a welcome boost," said Malcolm Offord, the UK Minister for Scotland.
The deal has the potential to almost double UK exports to India, boost Britain's total trade by as much as £28 billion a year by 2035, and increase wages across the country by up to £3 billion. Investment from Indian companies already supports 95,000 jobs across the UK.
With India set to be the world's third largest economy with a middle class of almost 250 million shoppers by 2050, London wants to unlock the huge new market for British producers.
"The UK has world-class businesses and expertise we can rightly be proud of, from Scotch whisky distillers to financial services and cutting-edge renewable technology. We are seizing the opportunities offered in growing economies of the Indo-Pacific to cement our place on the global stage and deliver jobs and growth at home," said country's Prime Minister Boris Johnson.
The first round of negotiations is expected to start next week – making it the UK’s quickest start of formal talks between negotiating teams following a launch.
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