Kentucky Bourbon Industry Enthusiastic About US-India Tariff Deal
The Kentucky Distillers’ Association today hailed the groundbreaking agreement made by President Trump and Indian Prime Minister Narendra Modi to lower India’s tariffs on bourbon, opening the world’s largest whiskey market for significant increases in Kentucky Bourbon offerings.
“We have seen worldwide, when trade restrictions are eased, that the elegance and complexity of Kentucky Bourbon attracts discerning palates of connoisseurs and new drinkers alike,” KDA President Eric Gregory said. “The agreement to lower tariffs from 150% to 100% is a historic accomplishment.
“We are grateful for President Trump’s collaboration with [Prime Minister] Modi to confront this long-standing prohibitive tariff and create a more favorable path towards progress for Kentucky Bourbon. We are eager to share more of our mellow amber spirit with India’s consumers.”
Gregory also applauded Kentucky Congressman Andy Barr for his tireless work in exploring opportunities to help Bourbon succeed, including pushing for lower tariffs in India. Barr’s 6th District is home to many of Kentucky’s distilleries and the thousands of jobs they create.
Congressman Barr said, “Thoughtful agreements like this will help protect Kentucky jobs and bring a taste of our state to more communities across the globe. America’s distinct spirit will now be more accessible in a market that will open doors for our state’s signature Bourbon industry.”
Kentucky is the birthplace of Bourbon, producing 95% of the world’s supply. The homegrown industry is a $9 billion economic and tourism powerhouse, generating more than 23,100 jobs with $2.2 billion in salaries and benefits, and attracting more than 2.5 million visitors each year to the KDA’s Kentucky Bourbon Trail tour.
The Commonwealth currently has three times more aging barrels of whiskey – 15.4 million – than people, 4.5 million.
India is Kentucky’s 14th largest export market sending $3 million in whiskey annually, which is expected to accelerate with the tariff reduction. That is just 1% of the $255 million in American Whiskey exports that are imperiled by Trump’s threats to slap tariffs on Canadian products, so India is not currently an important market for American Whiskey. However, India is also the world’s largest consumer of whiskey (if you count their domestic production of ersatz malt whiskey mixed with de facto rum as whiskey), with whiskey accounting for 60% of the alcohol market there. As the Indian middle class has grown, the country has long been seen as a desirable export market for not just American whiskeys, but also Scotch and Irish whiskeys. Indian tariffs and regulatory barriers have, by and large, kept foreign whiskey imports out of the country, and foreign drinks companies have been trying to lower or work around those barriers for decades.
Gregory said with the current size of Kentucky’s Indian export market, this agreement will unlock more avenues for Kentucky’s distillers to grow and tackle headwinds that are charging towards the industry.
