You may not have noticed, but the Indian liquor industry hasn’t had the best time recently. If numbers are to be believed, Indians are ‘sobering up’.

The beverages and spirits in India had maintained a steady growth of 6% annually for five years until 2015. But sales grew a mere 0.2% last year. Euromonitor, the research firm that has presented the findings, believes that the primary reason for such a fall has to do with the state government policies and higher taxation laws.

Last year, Nitish Kumar promised prohibition in Bihar if elected, and has gone on to impose it. He has also claimed that if his party wins in UP, the same will be implemented across the massive state. Both Karunanidhi and Jayalalitha promised the same prior to the TN elections. We already know that liquor sale is banned in Gujarat and partially in Kerala. In addition to this, there’s the increase in state taxation on beer in Odisha have all taken their toll.

However, India isn’t an exception to the rule. Globally too, liquor volumes have dropped for the first time in fifteen years due to currency volatility and unstable commodity prices. Volumes too have dropped by 0.7%.

Fewer spirits (whiskey, rum & brandy) are are being sold. Beer on the other hand has been a steady gainer with a 2% increase in volumes from last year. Some companies have been helped by increased sales of scotch whisky, white rum and vodka.

How is the industry reacting to these changes? Several alcohol makers have increased their marketing spends to catalyse the slow-growth market. Fresh consumer bases (such as liquor for women) are being explored.

Do you think the situation will get better with time? Do you think politicians will give up their pro-prohibition vote banks? What do you think will happen?

 

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