New Delhi, July 25 -- Indian consumers hoping for the prices of their favourite UK whiskies to drop dramatically after the free-trade agreement need to temper their expectations.

The India-UK Comprehensive Economic and Trade Agreement (CETA), officially signed this week, will reduce the current 150% customs duty on spirits by half to 75% once the agreement comes into force, with a further reduction to 30-40% over the next 10 years. This applies to both 'bottled-in-origin' (BIO) spirits and bulk imports used by Indian manufacturers for blending with Indian made foreign liquor (IMFL). The UK wines and beers are exempt from the deal.

Industry analysts and company executives suggest the immediate impact on retail prices will likely be modes...