Last month’s announcement of a long-awaited free trade deal between India and the UK was seismic news for the drinks world. Scotch Whisky Association chief executive Mark Kent echoed the views of many, hailing the deal as “transformational”. India, the world’s biggest whisky market, is set to slash tariffs on Scotch whisky and UK gin from 150% to 75%, before falling to 40% by the 10th year of the deal.
Unlike China, India is a mature brown spirits market, with a booming economy, a rising middle class and liberalising attitudes toward alcohol consumption. Yet smaller to mid-size UK distillers have traditionally been put off investing in the Indian market due to the country’s high import tariffs, fragmented regulatory environment, red tape and advertising restrictions. The new free trade deal removes a major barrier for many of these potential exporters.
While Indian domestic drinks retailers will undoubtedly applaud the deal, the reaction of the country’s fast-growing airport duty free retailers is likely to be more muted as the current status quo is advantageous. Liquor remains the leading product category at the country’s airports, with premium Scotch the top seller. Arrivals stores and returning Indian travellers account for the majority of sales.
Indian duty free retailers are currently thriving due to a massive price advantage on spirits versus the domestic market, but that price saving on Scotch whisky and UK gin will significantly narrow in the years ahead. Given the importance of Scotch, operators will need to accelerate the premiumisation trend, which is already underway, focusing less on price and more on rare, boutique or travel-exclusive expressions.
Alternatively, airport retailers may pivot toward other spirits categories, including whiskies from other countries – or, most likely, homegrown Indian spirits, which continue to enjoy a growing international reputation. The most worrying outcome, from a drinks perspective, would be if operators decided to devote less space to liquor and more to other product sectors, most notably beauty, a trend already seen in many other travel retail markets.
Growing hub airports
For now, however, whisky brands are flocking to India’s fast-growing hub airports, attracted by soaring passenger numbers. In April, Moët Hennessy opened a new House of Glenmorangie boutique in the arrivals area of Mumbai Airport with retail partner Ospree Duty Free. The new store is only the Speyside distillery’s second airport location, following its first at London Heathrow in 2023.
The store’s product line-up focuses on the brand’s expanding range of travel retail exclusives, such as the new Glenmorangie 12 Year Old, Glenmorangie 14 Years Old Quinta Ruban, Glenmorangie Vindima 16 Years Old, and Grand Vintage 1998. Moët Hennessy’s popular Islay malt brand Ardbeg also makes an appearance, with the travel retail-exclusive Ardbeg Smoketrails taking centre stage alongside higher-end offerings such as Ardbeg 25 Years Old.
Also expanding its presence at Mumbai Airport – India’s second-busiest hub – is Suntory Global Spirits. The Japanese multinational opened an arrivals shop-in-shop with Ospree in the same month, at the same arrivals location. The cross-category outlet highlights the group’s deep portfolio, showcasing Scotch malt whisky with a broad range of high-end Bowmore expressions, Japanese whisky (Hakushu and Hibiki), vodka (Haku), gin (Roku) and American bourbon (Jim Beam and Maker’s Mark).
“This is a strategic and significant partnership,” said Suntory Global Spirits managing director of global travel retail Ashish Gandham at the store’s opening. “India stands out as one of the fastest-growing markets in aviation and travel retail, with arrivals driving 70% of sales. We are confident that our multi-brand space will swiftly transform into a must-visit destination for the many spirits enthusiasts arriving in Mumbai.”
But Indian airports aren’t the only battleground for premium brown spirits brands. Just last month, The Edrington Group unveiled its new The Macallan boutique at London Heathrow Terminal 5 – an 84sqm space designed in collaboration with acclaimed architect Jamie Fobert. The store’s flowing, wave-like wall pays homage to the distillery’s undulating roof, while a copper display showcases rare releases, all inspired by The Macallan’s natural surroundings.
The boutique features a tasting bar, a VIP seated area for private tastings, a gifting station and an interactive Discover Your Expression tool that recommends whiskies based on personal taste preferences. The store even boasts a bespoke soundscape of field recordings from The Macallan Estate.
The product line-up includes travel retail exclusives such as the Colour and Harmony Collections, alongside more prestige offerings such as Time:Space Mastery, The Red Collection, and select Fine & Rare expressions. A limited range of lifestyle accessories – hats, scarves and branded glassware – rounds out the selection.
In addition to this new Heathrow boutique, The Macallan also has standalone airport store locations at Dubai International and Taipei Taoyuan, as well as shop-in-shops at Istanbul, Delhi’s Indira Gandhi and Panama Tocumen airports.
Expect further retail outposts in the future as this most famous of Speyside malts continues to defy the downturn other parts of the Scotch whisky business are experiencing.
