World · India Bureau
Indian Customs Seizes Pernod, Diageo Scotch Shipments Over Tariff Row
Indian customs authorities have detained bulk shipments of Scotch whisky concentrates from Pernod Ricard and Diageo, imposing a 150% tariff rate instead of the concessional 75% duty. The dispute centers on whether bulk concentrates qualify for preferential trade agreement benefits.
LSN India ·
Customs investigators have ordered the higher tariff assessment on the shipments, arguing that bulk Scotch concentrates imported for whisky production do not meet eligibility criteria under the applicable trade pact provisions. The concentrates, which are used as base materials for manufacturing finished whisky brands, are at the center of the tariff classification dispute.
The investigation challenges the reduced 75% duty rate claimed by the importers, suggesting instead that bulk concentrates should be assessed at the full 150% tariff level. The move reflects stricter customs interpretation of trade agreement terms governing spirit imports and processed alcohol concentrates.
Pernod Ricard and Diageo, major players in India's spirits market, have significant operations involving Scotch whisky imports and domestic production. The tariff dispute could have implications for their production costs and pricing strategies in India's premium spirits segment.
The seized shipments remain under customs custody pending resolution of the classification and duty assessment issue. The case highlights ongoing interpretive differences between customs authorities and importers regarding tariff treatment of processed spirit concentrates under existing trade agreements.