UK-India trade deal to halve whisky tariffs and boost Scottish economy

Scotland’s whisky makers and exporters have welcomed a landmark UK-India trade deal that is expected to deliver a £190 million (US$253.3 million) boost to the Scottish economy as part of the British government’s Plan for Change.

Under the deal, tariffs on Scotch whisky will be slashed from 150% to 75% immediately and cut further to 40% over the next decade. Soft drink producers will also see tariffs reduced from 33% to zero.

The deal mirrors how other trade agreements, such as the EU‑Mercosur deal, have been leveraged by the alcohol sector to reduce barriers and unlock market access.

India is already an important market for Scotland, with 457 Scottish businesses exporting £610 million (US$812.5 million) worth of goods there last year. With tariffs cut and customs barriers eased, that figure is set to grow.

Scotland’s consumers could also benefit. Lower tariffs on Indian imports are expected to cut prices on clothing, food, and manufactured goods, while UK wages are forecast to rise by £2.2 billion (US$2.9 billion) annually as trade increases.

Scottish Secretary Ian Murray says the deal is “great news for Scotland and Scottish jobs” and would give “Brand Scotland” access to what is projected to become the world’s third-largest economy by 2027.

“As the UK Government delivers our Plan for Change, we are also bringing inward investment to Scotland to create jobs, boost economic growth and improve living standards right across the UK,” he adds.

The deal will increase market access and export of Scotch whisky brands.

“Game-changing” deal

Industry leaders say the agreement could be transformational for Scotland’s signature export.

Mark Kent, CEO of the Scotch Whisky Association, says the deal is an important milestone to reducing tariffs on Scotch whisky in a growing market.

“This will contribute to the government’s growth objective by laying the foundations for further investment and jobs.”

Jean-Etienne Gourgues, chairman and CEO of Scotch whisky firm Chivas Brothers, says the deal would be “a game changer,” noting that India is the world’s biggest whisky market by volume. He adds that greater access will support the export of its Scotch whisky brands, such as Chivas Regal and Ballantine’s.

Gourgues also points to the potential benefits for Scottish communities: “The deal will support long-term investment and jobs in our distilleries in Speyside and our bottling plant at Kilmalid and help deliver growth in both Scotland and India over the next decade.”

The deal requires ratification before businesses can begin to benefit.