India's spirits industry braces up cautiously ahead of UK FTA ratification

With tariff cuts under the UK-India FTA, spirit producers expect faster growth, price access, and stiffer competition in premium whisky

India’s spirits industry is getting aggressive with strategies as the UK-India free trade agreement (FTA) is awaiting ratification. This is also driven by rising demand for premium alcohol.

 

Producers expect tariff cuts to boost consumption, innovation, price accessibility, exports, and growth across metros and emerging cities.

 

Weighing on the implications of the proposed FTA, Uttar Pradesh–based Radico Khaitan noted that while tariff reductions are expected, the impact may be more measured than many anticipate.

 

“With the implementation of the agreement, duties should come down, though effectively, the net reduction may hover around 10 per cent, given the excise component,” the company observed. 

“Whisky was once our weakest segment, but we are now building real strength there. In the premium and above category, we doubled down on After Dark, and we have also introduced Morpheus at around ₹1,200 a bottle, tapping into the largest profit pool in the segment,” said Radico Khaitan managing director (MD) Abhishek Khaitan.

 

Sanjay Dutt-backed Glenwalk and Ajay Devgn-backed Glenjourneys maker Cartel Bros co-founder Mokksh Sani highlighted that the FTA is a transformative moment for the premium spirits category.

 

Mumbai-headquartered Cartel Bros plans to pursue premiumisation through quality, aiming for 20 per cent of India’s luxury single-malt market in two years. This would be via expansion, product innovation, and deeper consumer engagement.

 

The FTA will intensify competition, primarily within the ₹1,500 to ₹5,000 per bottle segment. Imported Scotch will become a formidable competitor to premium Indian made foreign liquor (IMFL) whiskies in this band, according to Cartel Bros.

 

Sani further argues that the recently signed FTA is not just another policy tweak but a signal that the mid-to-premium spirits are on the cusp of a breakout.

 

With tariffs coming down, the cost-to-consumer will drop, unlocking a bottleneck that has long constrained demand.

 

“For brands like ours, it allows us to offer our world-class single malts at a price point that is more globally aligned, making them accessible to a wider, aspirational consumer base. We expect to see a healthy double-digit volume increase for the single malt category over the next few months, driven purely by this newfound price accessibility,” added Sani.

 

On the consumer segments shaping the next phase of growth in whisky and Scotch, Cartel Bros pointed to a widening spectrum of demand.

 

A wave of new aspirational consumers in the super-premium IMFL category and mid-tier Scotch is one of the driving forces.

 

This shift reflects a broader cultural transition, as rising disposable incomes and evolving tastes draw first-time buyers towards global spirits.

 

The company noted that the momentum of established premium consumers is steadily gravitating towards more refined expressions, particularly true single malts.

 

Maharashtra-headquartered South Seas Distilleries & Breweries offered a tempered view on the potential market impact.

 

Not all segments, the company said, will feel the effects of the FTA. “We are well-prepared to meet competition,” said Hamavand Chinoy, director of South Seas, underscoring the growing confidence in India’s premium distilling landscape.

 

Looking ahead, the company plans to expand distribution across eight states in the coming months. Its products are already in duty-free cities, including Mumbai, Delhi, Bengaluru, Hyderabad, Goa, Chandigarh, and Thiruvananthapuram. 

 

Duty-free outlets said that Indian malts like Crazy Cock and Six Brothers Mahura rival top global brands.

 

Reflecting on the momentum behind India’s whisky and malt segment on the back of FTA discussions, Rajesh Chopra, director general of Indian Malt Whisky Association, said the agreement could serve as a catalyst for the next phase of growth.

 

He said the move stands to invigorate competition at the premium end of the market, while offering a broader array of choices for increasingly discerning Indian whisky drinkers.

 

“Indian single malt whisky today enjoys strong consumer trust, global recognition, and competitive value positioning. Any change in the import duty regime will likely grow the overall premium spirits category rather than erode the standing of Indian producers,” added Chopra.

 

Chopra further said that the policy is being viewed not as a threat, but as a significant opportunity for the alcohol beverages industry.

 

He added that Indian single malts have already proven their mettle on the global stage, earning prestigious international accolades and expanding footprint to more than 60 export markets worldwide.

 

“The category’s success is rooted in distinctive regional character, innovation, and authenticity. Healthy competition will only push producers to raise standards further. We are confident that Indian single malts are equipped to grow their share in an evolving premium market,” Chopra said.

 

Sani of Cartel Bros added that while exact figures remain confidential, Indian single malts are expanding at roughly 7-10 per cent annually. With the single-malt Scotch market at about 2,00,000 cases, it expects volumes to reach nearly 3,00,000 post-FTA, driven not only by metros like Mumbai and Delhi but rapid premiumisation in Tier II hubs such as Chandigarh, Pune, and Lucknow.

 

India’s spirits market is already massive, estimated at around $52.5 billion, with projections pushing it toward $64 billion by 2028.

 

(With input from Akshara Srivastava)