Delhi liquor retailers in low spirits ahead of busy festival season

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With little clarity on the pricing of liquor to be sold in Delhi under the new excise policy, alcohol manufacturers and merchants are bracing for uncertain times, the Mint has reported.

Manufacturers, who must re-price and label bottles, and as new merchants, who are expected to start selling alcohol on November 17, will be affected by the delay. The period of uncertainty coincides with the festival and wedding season.

As part of the transition to the new excise policy, Delhi closed more than 260 private vending machines last month. Those who won licences in new bids are expected to launch outlets by the middle of November. Consumers in Delhi have been scrambling to buy their favourite liquor because only government-run establishments are open and stock is limited.

At least three liquor producers indicated that they are yet to receive any pricing information. Since the excise office is yet to make price and labelling determinations, two retailers foresee delays in acquiring new goods.

Liquor policy

The excise office in Delhi is expected to make a decision on alcohol price soon after bids closed on September 15. However, nothing has changed on that front.

Mint quoted Siddharth Banerji, MD, Kyndal Group, as saying that the excise office is yet to issue any instructions, and there is no way of knowing what the labelling will look like or what the pricing would be because no pricing rules have been issued.

The maximum retail price (MRP), the name of the manufacturer, and the distributor are normally included in the labeling of every alcohol bottle.

After the tendering process was completed, the new allottees or those who now hold the L-7Z store licences were given two weeks to submit their MRP inputs to Delhi’s excise commissioner, who would then take into account the price of the product in neighbouring states of Haryana, Uttar Pradesh, Punjab, and Rajasthan to arrive at the MRP.

Once the goods arrive in the store, licencees or retailers are free to provide concessions or reductions on the MRP.

The report quoted Ankur Jain, founder of B9 Beverages, which owns Bira 91 beer as saying that he expects the situation to settle down in the medium term. Although there is some confusion about pricing, the policy appears to be clear that only a small excise tax will be imposed.

The new liquor policy divided the city into 32 zones, each with eight to ten wards. Every ward has an average of 27 vending machines or liquor stores with walk-in service.