India, EU Discuss Whisky Maturation Under FTA

New Delhi, Jan 28 (PTI) India and the European Union have agreed to discuss the issue of the "maturation" period in the whisky sector in a working group formed under the free trade agreement, an issue of key interest to domestic alcoholic beverage makers, an official said on Wednesday.

Domestic players have stated that the EU should remove the condition of maturation for a minimum of three years for Indian whiskies since it is scientifically established that in warm and tropical Indian conditions, whisky ages 3-3.5 times faster than in Europe.

Indian whiskies should be allowed to be sold in the EU as whiskies irrespective of whether they are made from malt, grain spirits or molasses-based spirits, and they should accept Indian recipes as India accepts European or British recipes for whisky, according to the Confederation of Indian Alcoholic Beverage Companies (CIABC).

The commerce ministry official said a working group has been formed on wines and spirits under the agreement.

"In the group, we will also be discussing issues around maturity because maturation period is an issue between different geographies. India's maturation period is shorter and the EU's maturation period for spirits is longer. So we will be working on that," the official said.

The working group will exchange information, knowledge and best practices.

India and the European Union (EU) on Tuesday announced the conclusion of negotiations for a free trade agreement (FTA). It is expected to be signed and implemented this year itself.


At present, alcoholic beverages in India attract import duty of 150 per cent.

European wines are set to enter the Indian market at lower prices under the trade agreement as India will provide import duty concessions.

Currently, wines constitute less than 1 per cent of alcoholic beverages market in India.

As per the pact, India has given gradual and selective duty reduction on wines.

There will be no duty cut on wines priced below 2.5 euros with an aim to protect domestic wine producers and grape farmers in regions like Maharashtra (Nashik) and Karnataka.

For wines priced between 2.5 euros and 10 euros, the duty will be reduced to 30 per cent in seven years. For those priced above 10 euros, the duty will be cut to 20 per cent.

"It ensures the domestic sector sufficient time to expand, innovate, and enhance global competitiveness," the official said.

Further under the pact, Indian wine will enjoy preferential market access, with customs duties reduced from up to 32 euros/hectoliter (equal to about 100 litres) to zero, either at entry into force or phased out over 3-7 years after the implementation of the pact.