- Trade deals with the US and EU will reduce Indian liquor import duties from 150% to 30-40%
- Consumers may see prices of imported spirits drop from Rs 4,500 to around Rs 2,500-3,000
- US deal may boost American whiskey sales, challenging Scotch's traditional dominance in India
A couple of landmark trade deals with the United States and the European Union are expected to turn the Indian bar scene upside down in the near future. For the longest period, the Indian alcohol market has been defined by a single number - 150%. That was the 'protectionist moat' of import duties that kept global spirits extremely expensive, out of reach for anyone without a VIP airport pass or a deep wallet. But that wall may soon be coming down.
That is because of a couple of blockbuster trade frameworks that were announced on Feb. 7 between the United States and India and a similar deal inked with the EU at the end of January 2026.
Goa Vibes At Your Doorsteps
If you have ever winced at paying Rs 4,500 for a bottle of a standard Scotch or Bourbon in Mumbai that costs a fraction of that in Dubai or Singapore, the math will soon start mathing for you.
Under the new terms, tariffs on US and EU spirits are expected to fall significantly from that 150% peak to a range between 30-40% (judging by the EU deal). This means average consumers could see a price drop of roughly the same amount at retail. Therefore, a bottle that used to cost Rs 4,500 could soon cost just Rs 2,500 to Rs 3,000.
The Battle of the Barrels: Scotch vs. Bourbon
The reduction in import duties for liquor could lead to the influx of various drinking cultures into India. Following the EU deal, for example, we may see Scotch and Irish whiskey makers leaning into tradition and prestige. They might want to lock in the older, affluent demographic that long viewed Scotch as the ultimate status symbol.
On the other hand, the US deal signed Feb 7 could directly lead to brands like Jack Daniel's and Jim Beam prices falling significantly, whereas the companies might benefit from the nation's booming cocktail and nightlife culture.
Thanks to the US deal, the Bourbon can now compete on a level playing field with European giants, and keeping that in mind, there could be a surge in American whiskey as it looks to challenge the long-standing dominance of Scotch.
The ‘Bottled in Origin' Revolution
The potential winding down of the liquor import tax may put an end to the Bottled in India trend as well. Imported concentrated mixed with local grain spirits to avoid the 150% tax, most international brands had sold BII up until now. But with the tax now gone, the focus could shift to Bottled in Origin.
Consumers, after all, will no longer have to settle for IMFL brands and can simply afford the authentic, unadulterated product from the source. This is a total game-changer in the standard and premium range.
The Craft Squeeze
However, it's not happy hour for everyone. The reduction in import duties could spell trouble for homegrown Indian craft brands like Indri and Amrut. Various other premium gins may also find themselves in the 'danger zone'.
In the past, these brands had occupied a sweet spot as a local alternative to the mass-market liquor. Now that a bottle of imported Jameson or Jack Daniels costs just as much as a premium Indian craft gin, it's hard to expect consumers not to make some hard choices.
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