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British whisky makers eye India

The industry's emerging markets include India (more than 89%) and Turkey, reports Nabanita Sircar.
None | By Nabanita Sircar, London
PUBLISHED ON MAR 24, 2006 06:31 PM IST

Whisky exports had their third best year in history in 2005, with remarkable growth especially in Asia, led by China with an 86 per cent surge.

But India and Turkey are the markets they have their eyes on.

Figures released this week by the Scotch Whisky Association (SWA) reveal what officials called a continuation of the "global renaissance" in the country's most famous export.

In 2005, exports of both malt and blended Scotch rose 4 per cent in total, reaching a combined £2.36 billion worth, the industry's third best annual export performance, bar 1997 and 2002.

Although the US remained Scotland's most valuable market worth £372.7m - a 10 per cent rise - exports to Asia surged 24 per cent in total, led by South Korea (+24 per cent to £156m) and Taiwan (+24 per cent to £102m), Thailand (+25 per cent to £48m) and China (+86 per cent to £46m).

Around the world, 989.1 million bottles of Scotch whisky were exported, also a 4 per cent rise.

Richard Burrows, chairman of the SWA, added, "All the signs are that we are seeing a renaissance for Scotch whisky in its international markets. The industry is rising to the challenge of broadening the appeal of Scotch whisky to new consumers in new markets."

But he added that the 2005 figures also demonstrated "the widespread international appeal of Scotch" with growth also in the industry's priority emerging markets, including India (+89 per cent) and Turkey (+12 per cent). But the export to both these potentially huge markets remain small in global terms, because of the current tariff restrictions, tax and technical barriers to trade, an issue that has dominated the association's activities in recent months.

"The SWA is working to remove these barriers which continue to prevent the sale of Scotch whisky on a fair and equal playing field with competing products," he said. A month ago, the SWA hit out at the Indian government for bowing to "protectionist" domestic pressures after it maintained fiscal discrimination against Scotch whisky imports in the country's new budget, failing for the second year in a row to take any steps to align its import and domestic tax regime for spirits and WTO rules.

The SWA has been calling on India to reduce its basic customs duty from 150 per cent to 75 per cent, and to end the internal duties which combine to put Scotch whisky outside of the reach of all but the wealthiest.

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