Menezes: UK could have free trade with India before EU

26 January, 2017

Diageo CEO Ivan Menezes has said the UK “could move ahead of the EU in terms of getting a Free Trade Agreement” post Brexit.

The Diageo chief accompanied UK prime minster Teresa May on a trip to India in November which focused on breaking down barriers to trade and investment and paving the way for an FTA.

India is currently the third largest market for scotch by volume and the 9th by value, despite an import tariff of 150%.

The EU has failed to remove the levee over ten years of negotiations, something echoed by Menezes: “The EU was moving down a path but it never got anywhere.”

Diageo’s sales to India increased 2% in organic volume growth and 4% in organic net sales in H2 2016 and with the company well “positioned” in the market through its USL business, the removal or reduction of a tariff could have a big impact on sales.

Menezes told DI: “India is a big one because the duty is so high. It’s very hard to predict or speculate how trade arrangements will evolve. This will take time - it requires the UK and India working together. Spirits is a small piece of the puzzle – there are a lot more interests on both sides.”

Menezes added that as a company with a global portfolio, Diageo is hoping for free trade that isn’t exclusive to the UK. “We’re not looking here for just a UK angle," he said.  

Keywords: UK, eu, menezes, india tariff

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