The Indian government has reduced import duties on bourbon whiskey and several varieties of wines from the United states of America. The duty on bourbon whiskey has been slashed from 150% to 100%, while tariffs on wines made from fresh grapes, vermouth, and other fermented beverages have also been lowered to 100%. Additionally, unadulterated ethyl alcohol with an 80% strength has been included in the duty cuts. For bourbon whiskey, the basic customs duty has now been set at 50%, along with an agricultural cess of 50%. 

The revised duties were formally notified on Thursday, just hours before Prime Minister Narendra Modi’s meeting with US President Donald Trump, where tariffs featured prominently in discussions.

Trump has repeatedly criticised India’s tariff policies, citing them as among the highest in the world. In his interaction with the media before meeting Modi, he reiterated his commitment to imposing “reciprocal tariffs” to protect American industries. The duty cuts are seen as part of India’s broader strategy to ease trade tensions with the US while addressing long-standing concerns from other countries.

What about other trade partners?

India’s high tariffs on alcoholic beverages have been a contentious issue for multiple trade partners, including Australia, the UK, the European Union, and Switzerland. The recent duty reductions follow similar cuts on Australian wine under a trade agreement. The UK has also been pushing for lower levies on Scotch whisky in ongoing trade negotiations, while the EU has sought reductions for wines produced within its member states.

What it means for drinkers

The reduction in import duties is likely to make imported bourbon whiskey and premium wines more affordable for Indian consumers. However, the continued imposition of an agricultural cess may limit the extent of price reductions. While this move benefits enthusiasts of international spirits, domestic manufacturers could face increased competition in the premium segment.