NEW DELHI: Amid pressure from the United States, govt has slashed the import duty on bourbon whiskey from 150% to 100% and lowered tariffs on several varieties of wines.
Duty on wines made of fresh grapes, and vermouth, as well as some other fermented beverages and unadulterated ethyl alcohol with 80% alcohol strength have been cut to 100%. The import of these products together added up to around $1 billion during the last financial year.
In case of bourbon, the basic customs duty has been fixed at 50%, while agricultural cess of 50% has also been imposed. Last year, the imports of the two tariff lines related to bourbon were estimated at $2.6 million, while those from the US were pegged at $0.8 million.
The duty cuts were notified on Thursday, hours before PM Narendra Modi’s meeting with US president Donald Trump, where tariffs were at the centerstage of the discussions. Trump reiterated his promise to impose what he called reciprocal tariffs to keep American industry competitive. Just before meeting Modi, he had also said that India had among the highest tariffs in the world.
India’s duty on whisky and other alcoholic beverages have been an area of concern for most – from Australia to the UK, the European Union, Switzerland and the US. While India has slashed duties on Australian wine as part of the trade agreement, the UK has been putting pressure to lower the levy for Scotch as part of the trade negotiations. Similarly, EU has been demanding a cut for wine produced in the trading bloc.
In the Budget presented on Feb 1, govt had slashed import duty on a range of products, including high-end bikes, such as the iconic Harley Davidson, in a move seen to be focused on escaping the heat on tariffs. But that has not stopped Trump from raising concerns over duties in India as he cited Harley Davidson as an example during an interaction with the media.