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Thirst for Scotch soars in India

News, 19 September 2016

EDINBURGH: Exports of Scotch whisky have increased for the first time since 2013, buoyed to a significant extent by strong demand in India and France, the latest trade figures have shown.

According to the Scotch Whisky Association (SWA), global export volume grew by 3.1% in the first half of the year, representing the equivalent of 533m 70cl bottles shipped overseas from Scotland.

The SWA said it was encouraged that the global market for premium single malt Scotch whisky continued to grow, with export value increasing by 6% to £431m and volume up 3% to 49m bottles.

However, blended Scotch whisky continued to take the lion's share of exports. While volumes increased by 1% to 362m bottles, export value was down 4% to £1.16bn, which the SWA said may reflect the growth in single malts.

France remained the biggest export market, accounting for the equivalent of 90.9m bottles in the first half of 2016, up 5% from the same period last year.

Meanwhile, volume sales dropped 3% in the US to 53.1m bottles, although the country remained the second largest export market for Scotch whisky and by far the largest in terms of value (£357.4m).

However, one of the standout figures in the SWA report was the 41% surge in shipments to India, making it the third-largest export market at 41m bottles, with value also up 28% to £43m.

That suggests that India's burgeoning middle classes are increasingly turning to aspirational Scotch brands, such as Diageo's Johnnie Walker, which has featured in at least 25 Bollywood films, the Times reported.

The surge in demand in India seems even more pronounced given that the Indian authorities impose customs duty of 150% on Scotch whisky imports, which the SWA described as "exorbitant".

The trade body called on the UK government to prioritise this in discussions with India as it develops its post-Brexit trade links.

"The first half of 2016 was marked by an improving Scotch whisky export performance, suggesting a strengthening in global consumer demand compared to the last couple of years," said David Frost, Chief Executive of the SWA.

"It is clear, however, that the uncertainties of the Brexit vote will create challenges for exporters and we continue to encourage early clarity on the likely shape of the UK's future trading relationship with the EU and other countries."

Data sourced from Scotch Whisky Association, Times; additional content by Warc staff