The Indian government is actively working to resolve a classification dispute impacting Scotch whisky imports, with officials expressing optimism that a solution will be reached soon to address concerns raised by major liquor companies.
Government Hopes to Resolve Scotch Whisky Import Issue Very Shortly
New Delhi [India], November 13 (ANI): The government is hopeful of resolving the ongoing Scotch whisky import shipment issue within the next few days, with the Department of Revenue working to address concerns related to product classification, Commerce Secretary Rajesh Agrawal said on Friday. Speaking on the issue, Agrawal said classification remains among the "key concerns." "Department of Revenue is working to resolve it. Classification is among the key issues. It should be resolved very soon...We are very hopeful that it would be resolved in some days," Agrawal said.
The remarks come after officials from the Commerce and Finance ministries held a meeting to address concerns raised by liquor companies over the classification of imported Scotch whisky. People familiar with the matter had told ANI on condition of anonymity that officials from both ministries discussed the issue in detail and expressed optimism about an early resolution. Earlier, representatives of the International Spirits and Wine Association of India (ISWAI) and the Confederation of Indian Alcoholic Beverage Companies (CIABC) met Commerce Secretary Agrawal to raise concerns over differences in customs duties arising from the classification dispute.
According to the sources, customs authorities had held shipments belonging to major liquor companies, including Pernod Ricard India, Diageo, Radico Khaitan and Allied Blenders and Distillers, due to the dispute. The industry has objected to the Directorate of Revenue Intelligence's (DRI) classification of imported Scotch whisky as alcoholic beverage concentrate instead of finished whisky, resulting in a disagreement over the applicable Harmonised System (HS) code and customs duty. The matter has also raised concerns over the implementation of the India-UK Free Trade Agreement (FTA), with industry representatives describing the dispute as a technical issue affecting the application of the trade agreement. During the earlier meeting, Agrawal had reportedly assured industry representatives that the government would work towards resolving the matter, the sources said. Around 80 per cent of Scotch whisky imports from the UK arrive in bulk and are used to produce Indian-Made Foreign Liquor (IMFL). Scotch exports to India stood at USD 335 million in 2024, while the Scotch Whisky Association estimates that the India-UK trade agreement could boost trade value by USD 1.34 billion over five years. However, the industry has raised concerns that the classification dispute could undermine market-access benefits under the India-UK trade agreement, which came into force on July 15, 2026. (ANI)
