For more than three months now, the Food Safety and Standards Authority of India – an agency of the Ministry of Health and Family Welfare – has been blocking the import of Scotch whisky and other premium liquors from Europe into India. The block has been imposed on the grounds that manufacturers have consistently failed to meet the labelling requirements specified in India's food safety and standard rules that came into force in 2011.
Thus far, manufacturers have been granted interim relief from following the rules, but the Food Safety and Standards Authority has suddenly decided to crack the whip. At least 60 shipments of imported spirited drinks, including Scotch whisky, cognac, gin and vodka, are currently stuck at Indian customs.
This block is set to have a major impact on the spirits industry and its consumers: while many importers and distributors are worrying about blocked consignments and financial losses, lovers of fine liquor are wondering if stocks of imported drinks will soon run out.
“For now, my company has sufficient stocks of liquor,” said Keshav Prakash, owner of Vault Fine Spirits, a Mumbai-based importer of boutique spirits from around the world. “If the deadlock continues, then importers will have to go back to the manufacturers and urge them to comply with FSSAI labelling requirements, so that we can all continue business.”
The requirements, say traders, are not unreasonable in general but seem unfair when applied to spirits in particular.
For instance, the food safety and standards regulations state that all packaging labels must explicitly list out all the ingredients of the product, “except for single ingredient foods”. The rules also require “added water” to be listed as an ingredient, “except in cases where water forms part of an ingredient...used in the compound food”.
The specifics have led to a deadlock over interpretation, with European manufacturers insisting that most spirits are essentially single ingredient products and, therefore, bottles need not have ingredients listed on the label. Scotch whisky, for instance, is made of fermented grain and water, diluted to the extent that the water cannot be considered a separate ingredient.
“Given that the term ‘Scotch Whisky’ must appear on every bottle sold, there is no risk of consumer confusion as to what is being bought and no need for such a restriction,” said a spokesperson from the Scotch Whisky Association, a trade organisation representing the Scotch whisky industry in the United Kingdom.
Listing ingredients is not the only contentious aspect of the labelling rules, say importers, who claim that many shipments have been blocked because of unnecessary nitpicking – such as declaring the names and addresses of manufacturers, distillers and bottlers separately. “But in the liquor industry, it is widely understood that a spirit distilled by a certain company is also bottled by the same company, unless stated otherwise,” said Prakash.
According to another liquor importer, consignments have been blocked when labels carried just the brand name instead of explicitly stating “manufactured by”, or even if the words “produced by” are in a European language instead of in English.
Officials of the Food Safety and Standards Authority were not available for comment, but the Scotch Whisky Association and other trade organisations are in urgent talks with the authorities to urge them to exempt the drink from the specific labelling requirements. Since most other countries do not have such strict labelling norms, it would be difficult for manufacturers to come up with a special production line only for India.
“The labelling rules are in the right spirit and are meant to serve the interests of citizens, but it would be better if the FSSAI just let importers in India stick additional labels on the liquor bottles that fulfil all the requirements,” said an importer from a Mumbai-based company who did not wish to be identified.
This importer is facing a loss of Rs 3 crore if eight of his containers are not cleared by the authorities. Many bigger brands, he says, stand to lose much more. “But it’s not just the Indian market and consumers that will face the repercussions of this block,” he said. At the moment, India’s liquor industry is a hub for importers from neighbouring countries like Bangladesh, Nepal and Sri Lanka. “If the restrictions continue, all these countries will bear the brunt.”
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