India threatens tariff blow on Scotch whisky imports from Britain

India could review tariff concessions granted to the UK on goods including Scotch whisky if London does not respond to New Delhi’s concerns regarding its steel safeguard measures, an Indian official said ahead of upcoming bilateral trade discussions, Reuters reports.

The India–UK free trade agreement, signed in May last year and expected to come into force this year, has encountered obstacles after Britain proposed tighter safeguards on steel imports aimed at protecting its domestic industry.

"So now the ball is in their (UK) court," an Indian trade official told reporters on June 1. "If they do not leverage their free trade agreement, we can always reconsider the concessions we offered."

UK Trade Secretary Peter Kyle is scheduled to visit India for talks with Commerce Minister Piyush Goyal on Tuesday, June 2.

Under the agreement, India committed to reducing tariffs on Scotch whisky from 150% to 75% initially, with a further reduction to 40% over a 10-year period.

The deal also includes phased tariff cuts on both sides across a broad range of sectors, including textiles, whisky, and automobiles, while improving market access for businesses in the world’s fifth- and sixth-largest economies.

Both countries project the agreement could increase bilateral trade by an additional £25.5 billion ($34 billion) by 2040.

India has objected to the UK’s steel safeguard measures, arguing that they may limit market access for Indian exports. The dispute relates to tariff-free quotas and increased duties on selected steel shipments, adding uncertainty for Indian exporters even as implementation talks continue, officials said.

Alongside Brazil, Türkiye, Japan, South Korea, Switzerland, and Australia, India has raised concerns at the World Trade Organization over Britain’s new restrictions on tariff-free steel imports.

The UK has also proposed introducing carbon-related border measures from January 1, 2027, covering imports of products such as iron and steel, aluminium, cement, and fertilisers as part of its broader emissions reduction strategy.

By Jeyhun Aghazada