The Confederation of Indian Alcoholic Beverage Companies (CIABC) is advocating for enhanced market access for Indian products within the European Union.
The apex body of Indian alcoholic beverage manufacturers has called for the removal of non-tariff barriers by the European Union, which currently hinder the sale of the vast majority of Indian products in the EU.
The confederation comprises prominent Indian companies that produce and promote their product lines both within India and on the international stage.
CIABC, consistently expressing its concerns to the government, has emphasized once again that the trade agreement with the European Union concerning alcoholic beverages should mirror the ongoing negotiations with the UK.
“The most notable is the condition that for a product to qualify as a whisky, it must be matured for a period not less than three years, and brandy for one year,” CIABC Director General Vinod Giri said in a press release.
“It has been highlighted several times, along with scientific substantiations, that such long maturation is not applicable in a warm Indian climate. We believe that it is effectively a non-tariff barrier since long maturation increases the cost of Indian products by 30-40 per cent as spirit evaporates 10-15 per cent every year under Indian climate (compared to 1-2 per cent in Europe) and the cost of capital deployed during maturation (8-10 per cent per annum in India compared to 2-3 per cent for Europe),” Giri added.
“We firmly believe that if the EU does not repeal the law pertaining to the maturation, any trade agreement will be one-sided, thus favouring only the EU and doing nothing for the Indian industry,” he added.
Additionally, the representative from CIABC emphasized the need for parity between the EU and the UK, advocating for tax-free trade between the two. Furthermore, the representative noted the minimal transportation costs between the EU and the UK, attributing it to their geographical proximity.
“If the deals agreed upon are any different, one can expect the trade to start using the more favourable route without any incremental cost or control,” Giri added.
Moreover, the CIABC pointed out that many trade agreements typically involve a “most favored nation” status, potentially prompting other nations to seek parity if discrepancies exist in the agreements.
Illustrating with the India-Australia Free Trade Agreement as an example, CIABC clarified that if India extends more significant concessions to another country, Australia would have the right to demand equal treatment. Therefore, Giri emphasized that the terms offered to the EU for wines must align with what has been proposed to Australia.
“Considering all this, we firmly believe that India should offer the EU the same deal that is eventually agreed with the UK on spirits and what has been agreed upon with Australia on wines. Further, India should not offer any concessions if the EU does not open up its market for Indian products by repealing rules pertaining to maturation,” Giri added.
