India probes Scotch concentrate imports by Pernod and Diageo under new trade pact

Indian tax inspectors recently entered Pernod Ricard's headquarters near New Delhi, interrogating senior staff about the company's bulk Scotch whisky imports. At the same time, United Spirits, the Indian arm of Diageo, reported that several of its locations were searched in what officials described as an industry-wide exercise. Both firms have issued statements confirming full cooperation with the Directorate of Revenue Intelligence and the provision of all required paperwork.

The controversy stems from a trade pact that lowered import duties on certain Scotch products to 75%, but authorities claim the relief does not extend to bulk concentrates used in blended drinks. The UK accounts for the majority of India's imported spirits market, and the outcome could affect the valuation of iconic whisky brands sold locally. Pernod also faces separate antitrust litigation and a sizable back-tax claim, while Diageo recently had to reformulate drinks after a food-safety ban in several states.