Big Alcohol lobby group International Spirits and Wines Association of India (ISWAI) is pushing to slash taxes on British imported alcohol products and accelerate imports via the proposed free trade agreement (FTA) between India and the UK.
ISWAI is a lobby group for some of the largest liquor companies in the world, such as Bacardi, Beam Suntory, Brown-Forman, Campari Group, Diageo, Moët Hennessy, and Pernod Ricard.
The customs duty paid for foreign-made liquor in India helps to protect the country – where most people live free from alcohol – from being flooded with imported alcohol. However, customs duty have been an obstacle to Big Alcohol’s profit maximization goals in India. Currently, all imported alcohol products are subject to 150% customs duty.
Movendi International previously reported on Big Alcohol’s plans to use the FTA between India and UK to weaken alcohol laws. The FTA talks began in January and already in February the chief executive of Chivas Brothers (owned by Pernod Ricard) was signaling the Big Alcohol push to weaken the Indian customs duty on imported whiskey.
Big Alcohol campaign for new markets
ISWAI is pushing for a 75% immediate slashing of customs duty for imported alcohol products. Over 3 years ISWAI wants this customs rate reduced to 30%. This would directly and massively benefit the alcohol giants behind ISWAI as they seek to exploit India as new market, attempting to convert Indian alcohol abstainers to become users of their international products.
And the British government is doing the dirty work for Big Alcohol. London has expressed that cutting taxes on exports of finished goods, like Scotch whisky and British-made cars are a priority for them in the UK-India FTA.
Four rounds of FTA talks have been concluded. Both parties have agreed to finish the talks and reach an agreement by Diwali, which falls on October 24, 2022.
If the India-UK FTA leads to a customs duty cut for imported alcohol products, it will likely affect ongoing FTA negotiations with the European Union and Canada. Big Alcohol will interfere to achieve similar slashes in taxes for imported alcohol products through these two FTAs as well. Thus, flooding India with even more alcohol.
In 2019 India imported 1.66 million cases of Bottled in Origin (BIO) liquor. Out of this 1.18 million were Scotch whisky. The remaining 0.5 million mainly consisted of alco-bev products from the US, white spirits from the EU, and others. Big Alcohol stands to gain millions at the cost of the health and well-being of the Indian people if the FTA slashes customs duty for imported alcohol products.
Already trade agreements have weakened the Indian customs duty on imported alcohol products. In April, India and Australia signed the ECTA, an early harvest agreement intended to be the first step towards a larger deal due to be finalized by the end of this year. Through this, the threshold price of bottled wine was reduced.
The alcohol industry and trade agreements
Movendi International has previously reported evidence that revealed how the alcohol industry uses trade agreements to influence alcohol policies to benefit the private profit interest of alcohol companies to the detriment of the public interest to be protect from alcohol harm.
Mounting evidence has exposed that the alcohol industry uses the trade policy arena to interfere against alcohol policies, such as reducing tariffs and manipulating health warning labeling on alcohol products.
A study by Barlow and colleagues published in The Lancet found that the alcohol industry infiltrated World Trade Organization (WTO) discussions at Technical Barriers to Trade Committee meetings on alcohol health warnings and advanced pro-industry arguments in domestic settings to prevent effective alcohol policies.
Movendi International’s Alcohol Issues Podcast Season 2 Episode 5 further explores how and to what extent the alcohol industry uses the trade policy arena to shape alcohol policy around the world remains poorly understood.