Scotch whisky gets cheaper in India after UK trade pact: Johnnie Walker Black Label prices falls to Rs 3,800 from Rs 4,250, J&B to Rs 1,700 from Rs 2,300 as tariff drops from 150% to 75%
Scotch whisky prices in India have dropped by 10-15% for the first time since the India-UK free trade agreement came into force, with Diageo and Pernod Ricard passing on lower import costs to consumers in some key states.In fact, the price cuts for brands such as Johnnie Walker Black Label and J&B have already taken effect in Maharashtra, Rajasthan, Goa and Uttar Pradesh, while other states are expected to follow.Under the India-UK agreement, the import tariff on British whisky was reduced to 75% from 150%, effectively cutting the rate by half. The tariff is scheduled to decline further to 40% over the next 10 years. However, the reduction in import duty does not result in a similar reduction in the final retail price, since import duty accounts for only one part of the overall price, along with state excise duties, taxes, distribution expenses and margins.Also Read | Trade irony amid Trump threat: Why Russia is buying its own oil as fuel from India
Scotch whisky prices drop!
The price reductions mark the first major move by the two largest Scotch producers to adjust consumer prices since the trade agreement became effective on July 15. The cuts are also an early indication of how much of the savings from lower tariffs could eventually be passed on to Indian whisky consumers.Industry sources said Diageo’s 750-ml Johnnie Walker Black Label is now available for around Rs 3,800, compared with Rs 4,250 previously. The price of J&B has fallen to about Rs 1,700 from around Rs 2,300 earlier.Pernod Ricard has also approached the government seeking approval for lower prices for brands including Chivas, Ballantine’s and The Glenlivet, according to industry executives quoted in an ET report.“The UK FTA will have an impact on the existing prices being offered by bottled-in-origin brands. This could lead to a shift in the competitive dynamics for other whiskies, including Indian single malts,” said Sandeep Arora, founder of Spiritual Luxury Living according to the financial daily.“Price differences, the entry of new whiskies, and availability will be key factors for the Indian market,” he said.Before the lower prices could be introduced, the companies were required to submit proposals to state excise authorities and provide documentation establishing that the whiskies originated in the UK. People familiar with the matter said some states have already approved the proposed price reductions.
State-level pricing differences
Diageo had previously projected that prices across its bottled-in-origin Scotch portfolio could decline by around 7-9% on a nationally weighted average basis. The steeper reductions seen in some states are instead linked to differences in state-level pricing structures and individual commercial decisions, rather than being a direct reflection of the tariff cut.The lower prices could increase competitive pressure in India’s premium whisky segment, including on Indian single malt brands such as Amrut, Paul John and Rampur. With imported Scotch becoming relatively cheaper, the price difference between the two categories is narrowing.“While we have considered repricing to compete with these brands, we will have to wait till after the festive season to get a clearer picture of the market,” said Rakshit Jagdale, company chief, Amrut Distilleries.The first round of price reductions is being introduced in some of India’s largest whisky markets. Maharashtra and Uttar Pradesh rank among the country’s biggest whisky-consuming states, while Maharashtra and Haryana are important markets for Scotch.Pernod Ricard CEO Alexandre Ricard said in August that the company planned to use the agreement to make its brands “more relevant and more affordable to consumers”, while also bringing new Scotch offerings to the market and speeding up innovation from Britain.
