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    Breweries welcome the First Non-alcoholic Beer Policy in India led by West Bengal Government

    Published on September 14, 2021

    Reduction of Duty Slab Last Year as well by State Excise Department

    The first-of-its kind initiative forecasts boost in the Non-Alcoholic Beverage sector

    Kolkata : The West Bengal Government has been strategic and supportive to provide an impetus to the breweries in the state as per both brewing company and the consumer’s satisfaction. In its latest announced policy, the State Excise department has reduced duty slabs and the Excise Commissioner has permitted the production of Non-alcoholic malt beverages having alcoholic strength not exceeding 0.5% v/v that is 0.88 degrees proof at the brewery premises, after causing a necessary enquiry to his satisfaction. This comes as the first-ever move by the Bengal Government to introduce Non-alcoholic beer policy in the country. The inclusion of the new Rule 117B in the state excise policy will not only boost the business of the breweries, it will help the state government to earn more revenue as well.

    India has an approx. INR 28K Cr beer market and introduction of NAB (Non-Alcoholic Beer) policy will boost the Government of India’s Atmanirbhar Bharat initiative and Local for Vocal initiative. This will result in creation of significant economic value propositions for various up-stream sectors involved in the manufacturing process within India. NAB policy in West Bengal will result in further investment and economic activity increase around Celebrity Brewery along with additional capacity utilization.

    Speaking on the development, Vishal Kumar, Chief Operating Officer, Celebrity Breweries Pvt Ltd,  said “Introduction of Non-alcoholic beer policy along with a significant reduction in tax slab will indeed help boosting the sale of non-alcoholic beverage in the state. We are confident of the state earning an extra revenue of above 300 crores resulting from setting up of dealcoholizer unit, increased purchase of agri inputs, packaging materials, logistics and employment generation other than clocking an increased SGST. We welcome the move by the state excise department, as we can now invest in capacity installation at our Hooghly brewery and ensure the same manufacturing process as followed in countries like South Korea, Belgium and China.”

    Opportunities are immense in the low or non-alcoholic beer category in India given the rising awareness of healthy lifestyle among the young target audience and increasing disposable income. Non-Alcoholic Beer (NAB) is a beverage that maintains the essence of beer in terms of its flavor, appearance, and aroma, minus the alcohol content. It is an option provided by manufacturers for consumers who wish to enjoy the beer taste without consuming alcohol. According to a research data by Mintel, 38% of Indians wish to switch from standard-strength beer to low- or no-alcohol versions (LNA) which in turn forecasts the rising demand in the concerned sector. On the other hand, the reduction in tax slab will help make up for the loss of revenue during the COVID pandemic induced lockdown and encourage the brewery to create momentum in the healthy beverage segment.

    To commence with the process, the brewery needs to install the necessary infrastructure to produce nonalcoholic beer with prior approval from the Excise Commissioner. The Brewery permitted to manufacture non-alcoholic malt beverages shall pay a privilege fee @Rs.1/- per B.L. upon the volume of beer received for the production of non-alcoholic malt beverage.

    Joining in the business opportunity, India’s homegrown alcohol brands have been experimenting with creating non-alcoholic choices of alcoholic drinks or making own version of nonalcoholic beverage enriched with antioxidants and vitamins. Introduction of Non-alcoholic beer policy has been widely welcomed by the West Bengal State Beverages Corporation Ltd (Bevco) — the wholesale liquor trading arm of the state government and other alcohol brands operational in the state. The new policy amendment is likely to have a positive effect on creating social capital as well through generation of employment in the state.