India: ‘rapid’ growth forecast for alcohol

Volume sales of alcoholic beverages in India will see ‘rapid growth’ to 2027, driven by a penchant for brown spirits.

According to IWSR Drinks Market Analysis, India will be a key volume growth market for total beverage alcohol from 2022 to 2027.

India accounted for a third of global total beverage alcohol volume growth between 2021 and 2022, driven by ‘very buoyant’ spirits growth and the recovery of the beer category.

IWSR noted consumers in India were continuing to trade up within the whisky category, and were also showing similar behaviours towards domestic brandy, rum, vodka and gin.

Jason Holway, market analyst, IWSR, said: “There is strong consumption and growing premiumisation in India, helped by higher middle-class disposable incomes, the lifting of pandemic restrictions and improved quality, variety and availability in retail.

“Momentum is trending positively across drinks categories, with brown spirits performing particularly well. Consumers are trading up, notably in sparkling wine, whisky and agave-based spirits.

“As more brands come into the growing Indian drinks market, consumers are enjoying trying new categories.”

Premiumisation points to positive future for Scotch

IWSR said premiumisation was most evident in imported bottled Scotch whisky compared with any other category in India. Since 2000, volume sales have multiplied 20 times, and almost doubled between 2020 and 2022.

Single malt whisky sales have doubled since 2020, mostly driven by premium and super-premium bottlings.

For example, in Kolkata, 37% of consumers surveyed by IWSR in November and December 2022 said they were buying more expensive bottles of Scotch.

Gin, rum and Tequila have all taken greater market share since the start of the Covid-19 pandemic, with three in 10 consumers in Mumbai drinking gin and/or rum once a week, and 24% drinking more Tequila than other regions.

Mexico and Brazil were also noted alongside India as markets set to be key volume drivers of alcoholic beverages until 2027. The three nations are expected to take over from the US and China, with the latter market expected to stay relatively flat during this period.

Both the US and China, however, will remain ‘significant’ value drivers, IWSR noted. From  2022 to 2027, total beverage alcohol in China is forecast to grow by US$41.7 billion.

In the December 2022 edition of The Spirits Business, we looked at how an India-UK free trade agreement would affect the Scotch whisky category.