India may rethink Scotch whisky tariff cuts if UK does not ease steel import curbs
The India-UK free trade agreement, signed in May last year and expected to come into force this year, has run into obstacles after Britain proposed tighter safeguards on steel imports to protect its domestic industry.
Also Read: UK Trade Minister Peter Kyle to meet Piyush Goyal on June 2 on India-UK FTA rollout
“The ball is now in Britain’s court,” an Indian trade official told reporters on Monday. “If they do not take advantage of the free trade agreement, we can always re-evaluate the concessions we offer.”
British Trade Minister Peter Kyle will travel to India on Tuesday to meet Trade Minister Piyush Goyal.
Under the trade deal, India agreed to reduce customs duties on Scotch whiskey from 150% to 75% initially and to 40% within 10 years.
The agreement sees tariff cuts by both sides on goods ranging from textiles to whiskey to cars, while expanding market access for businesses in the world’s fifth and sixth largest economies. The two countries expect the agreement to increase bilateral trade by another 25.5 billion pounds ($34 billion) by 2040.
India has objected to Britain’s steel safeguard measures, arguing they could restrict market access for India’s exports. The dispute centers on tariff-free quotas and higher taxes on some steel shipments, creating new uncertainty for Indian exporters even as both sides try to implement the trade deal, officials said.
India, along with Brazil, Turkey, Japan, South Korea, Switzerland and Australia, have expressed concerns to the World Trade Organization over the UK’s new restrictions on tariff-free steel imports.
The UK has also proposed implementing carbon-related border measures covering imports of products such as iron and steel, aluminium, cement and fertiliser, from January 1, 2027, as part of efforts to reduce carbon emissions.
