A new GBP8m (US$12.8m) Scotch whisky distillery, aiming to produce up to 4m litres a year mainly for the Indian market, has been given planning approval.

Construction on the John Fergus & Co malt plant, in Glenrothes, Fife, Scotland, is expected to begin in the early part of this year, John Fergus founder, Ian Palmer, told just-drinks yesterday (9 January). Production should get underway early next year. 

Palmer said the next step is to secure the remaining equity funding for the venture. “We're continuing to work with Scottish Enterprise and the Scottish Executive in that area and we are working very hard and putting the last few blocks into place,” he added.

Phase one of the project will leave a 2m-litre annual capacity, while phase two will double that, depending on demand, Palmer said.

The distillery will produce a single malt as well as blend for other whiskies and liquid for the India-made foreign liquor (IMFL) market in India and surrounding countries. “We're looking for a quick turnaround in our product to give us a solid base for the business to allow us to develop from there," Palmer said.

Liquid used in IMFL, which traditional holds an amount of Scottish-made whisky, only needs to be matured for three years compared to four years for Scotch.

Palmer welcomed news that another planned distillery in Fife, Kingsbarns, has received backing from the Wemyss family, owners of Wemyss Malts. “It's an interesting time for the industry at the moment and it's great to see an opportunity opening up for a number of new and smaller organisations,” he said. “It's great days.”

Figures released last week showed that the country's whisky industry generates annual export sales in the region of GBP4bn (US$6.5bn)