McDowell’s No. 1 to shed ‘whisky’ tag abroad

When former liquor baron Vijay Mallya was running United Spirits Ltd (USL), the powerful Scotch Whisky Association (SWA) found it hard to get the Centre’s approval to lower tariff barriers for foreign-made liquor brands, and to ask local companies to stop labelling their spirits’ brands as whisky.

But with USL being taken over by the UK-based Diageo, SWA has finally been able to get its way. It has been able to enter into an agreement with Diageo where in McDowell’s No. 1 whisky, a brand owned by subsidiary United Spirits, will be sold under a different name in countries other than India. After Officer’s Choice, a brand owned by the Indian-owned Allied Blenders & Distillers, McDowell’s No. 1 whisky is the second largest selling among spirits in the world, with maximum sales coming from India.

SWA has always maintained that brew produced from molasses cannot be called whisky, though it remains the main raw material for Indian liquor manufacturers.

“We have come to an agreement with the SWA in relation to the labelling of McDowell’s in markets outside India. We will now be working through a transition period to implement the changes, which will remove Scottish references,” United Spirits spokesperson told BusinessLine . McDowell’s No. 1 whisky is sold in several countries including Africa, West Asia, Canada and also in the Far East.

Sales of Bagpiper are also expected to be affected as the agreement with SWA disallows its exports.

In recent months, SWA has also made other legal breakthroughs in India. India-based Oasis Distilleries, Adie Broswon Distillers & Bottlers and Malbros International, have all been prohibited from selling whiskies produced in the country, with reference on their labels to ‘Scotch’, ‘Scotch Whisky’ or ‘Scotland’, a statement on the SWA’s website said. The spokesperson did not say which new name has been given to McDowell’s No. 1 whisky. “The precise timelines and detail of these changes have still to be worked through but we are pleased to have reached a solution that works for all parties,” the spokesperson said.

Interestingly, a survey conducted by IWSR, a spirits’ research company and just-drinks, an online provider of news on spirits, the non-Scotch whisky sector is expected to post a compound annual growth rate of 4.7 per cent in the six-year period between 2015 and 2020, to 364.4 million cases.

It forecasts compounded annual growth in European regions like the UK (5.3 per cent), France (3 per cent) and Germany (1.6 per cent). The survey also points out that almost three quarters of non–Scotch growth will come from India.

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