Uttar Pradesh Unveils Progressive Liquor Policy for 2024-25 Fiscal Year
In a significant development for the state's alcoholic beverage industry, the Uttar Pradesh government has announced its excise policy for the upcoming financial year, bringing stability and new opportunities for stakeholders. The policy, which takes effect from April 1, 2024, focuses on maintaining price consistency while introducing measures to boost exports and streamline operations.
Price Stability and License Renewal Provisions
Consumers in Uttar Pradesh can expect retail prices of liquor brands to remain largely unchanged in the coming year, providing relief amidst economic fluctuations. This stability comes as welcome news for both buyers and the approximately 29,000 entrepreneurs engaged in the liquor trade across the state.
Existing retailers will have the option to renew their licenses and continue operations in the next fiscal period, ensuring business continuity. However, shop owners will need to pay a 7.5% increase in license fees compared to the previous financial year to maintain their establishments.
Groundbreaking Export Policy Initiative
In a first-of-its-kind move, the excise department is introducing a separate UP Liquor Export Policy designed to promote international sales of locally produced alcoholic beverages. This forward-thinking framework will remain effective for three fiscal years, spanning from April 1, 2024, to March 31, 2027.
UP-based manufacturers of various spirits including whisky, vodka, gin, rum, brandy, country liquor, wine, and beer will benefit from streamlined processes for marketing their products both domestically and internationally through this export-oriented approach.
Official Statements and Rationale
Excise Minister Nitin Agarwal explained the policy's development process: "We carefully considered representations from all trade stakeholders and implemented measures to facilitate smoother day-to-day operations. For the wholesale sector, we've revamped license fees based on volume, while distillery operators will now be permitted to open wholesale warehouses to improve viability."
The minister added that monthly guaranteed quotas for country liquor shops have been rationalized according to each shop's specific location, ensuring fair distribution across different areas.
Price Adjustments and International Brands
While final maximum retail prices are still being calculated by liquor companies using the stipulated formula, industry sources indicate that prices of popular English liquor brands and retail units could see modest increases ranging from Rs 10 to Rs 40. Conversely, premium imported brands may become more affordable as duties on such products have been revised downward.
Export Promotion Measures
Excise Commissioner Adarsh Singh detailed specific export incentives: "To encourage exports of UP-produced liquor, we've rationalized label approval fees for export-oriented brands and reduced export fees to just Rs 1 and Rs 0.50 per bulk litre for grain-based and molasses-based extra neutral alcohol, respectively."
In another innovative provision, distilleries will now be permitted to research and export heritage liquor for the first time, potentially opening new markets for traditional Indian spirits.
Industry Response and Digital Transformation
Amar Sinha, Chief Operating Officer of Radico Khaitan Ltd, praised the policy as "extremely progressive and production-oriented." He noted that consumers would enjoy increased choices, particularly in the country liquor segment, with new products at various price points becoming available from April 1 onward.
Perhaps most significantly, Uttar Pradesh is taking a national leadership position by mandating that all financial transactions across the entire liquor supply chain be conducted through a centralized portal. This digital shift from cash-and-carry models promises to enhance transparency, improve efficiency, and ensure legitimate products reach consumers while combating illicit trade.
The comprehensive policy represents a balanced approach that supports both business interests and state revenue objectives while positioning Uttar Pradesh as a potential hub for liquor production and export in the coming years.
