Whisky And Visas Could Be Part Of A United Kingdom Trade Deal With India.
Prime Minister Boris Johnson has stated that he hopes to reach an agreement with India on free trade by November. But, as he prepares to meet with his Indian counterpart Narendra Modi, it’s too early to celebrate the prospects of a deal that could be difficult to reach.
No other country consumes as much whiskey as India, which should be cause for celebration for Scotland’s world-renowned industry. However, due to 150 percent levies on imported whiskey,
each bottle of Scotch sold in India comes with a high price tag. As a result, the vast majority of whisky consumed in India is produced within the country’s borders.
Scotch Whisky Only Accounts For 2% Of The Market.
If tariffs are removed, the Scotch Whisky Association estimates that exports will increase by £1 billion in five years. It’s not only whisky: attempts to enter India’s markets are often met with significant trade barriers, such as tariffs, quotas, and investment restrictions.
For example, foreign cars are subject to tariffs of up to 100%. As a result, the UK now sells less to India, which has a much larger population, than to Belgium. That, however, may be about to change.
The UK And India Began Discussions At The Start Of This Year With The Goal Of Reaching An Agreement By The End Of 2022.
Next week is the commencement of the third round (with many more expected to follow). Such a pact, according to UK Trade Secretary Anne-Marie Trevelyan, would be a “great opportunity,” potentially more than tripling total trade between India and the UK by 2035, a £28 billion boost.
Australia and the United Arab Emirates have recently signed agreements with India, so expectations are high. When it comes to these negotiations, however, both India and the United Kingdom have wishlists, which could prove to be major roadblocks.
Britain wants broader access to India’s manufacturing and services sectors, which have historically been closed to international investment. However, trade economists believe that India will be hesitant to remove the safeguards that trade restrictions have given for domestic industry and employees. Mr Modi may be hesitant to lower tariffs because of the people who distill whisky within India’s borders.
If India does decrease such obstacles, it will have to make concessions in exchange. The UK may face pressure to allow Indian products into its market, such as medicines. There’s also the possibility that.
The initial stages of trade negotiations are frequently the most straightforward. The most difficult material is saved until last. As a result, it may be some time before the true scope of the situation becomes obvious.
Economists Believe That If Both Sides Are Willing To Make Sacrifices, An Interim Agreement Might Be Struck By The End Of The Year.
However, completing the sale by Christmas appears to be a stretch. Perhaps in recognition of the complexity, the Scotch Whisky Association has called for a “early harvest deal” that would eliminate whisky tariffs before a full agreement is reached.
While negotiators continue to thrash out the small print of harder areas behind the scenes, it may be tempting to secure a few favourable headlines and some good cheer.
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