Pernod Ricard and Diageo, two of the world’s biggest spirit makers, have stopped receiving orders for imported brands from India’s defence canteen stores where they were sold at concessional prices, industry sources told Reuters.
The move is seen as part of Prime Minister Narendra Modi’s “vocal for local” campaign in which he has called for promotion of indigenous products to make India self-reliant during the coronavirus pandemic, a government measure that critics have called protectionist and against foreign businesses.
India’s defence canteens provide access to both local and imported products such as liquor and electronics at less-than-market rates to soldiers, ex-servicemen and their families.
But Pernod Ricard India, whose brands include Chivas and Glenlivet scotch whisky, received no order in May for imported spirits, compared with monthly orders of 4,500-5,000 cases by defence stores, a source said. One case typically holds six, nine or 12 bottles of liquor.
Diageo India too has not received any orders since May for its imported brands such as the popular Johnnie Walker Black Label whisky and Talisker single malt, a second source said.
Pernod Ricard declined to comment and Diageo did not respond to queries. The defence ministry did not respond.
While no written order has been issued, a senior government official said a formal decision in the matter was imminent.
“We want to encourage indigenous products … with the PM’s campaign, it gets more priority,” said the official.
A bottle of Johnnie Walker Black Label costs ₹3,600 in Maharashtra’s defence canteens, a third lower than ₹5,500 retail customers pay there.
“Drinking scotch has become a habit, this move is going to hurt our pockets,” said a retired Indian army official who said he purchases five scotch bottles each month.
While imported liquor sales at defence stores generate only about $17 million in annual sales, the channel generates regular demand for top foreign brands. The canteens sell about $450 million worth of liquor each year, mostly Indian-made beer, whisky, rum and other spirits, sources said.