Explained: World goes slow on liquor, but India keeps the spirits high

Global alcohol consumption is falling as people drink less, but India stands out with rising liquor sales and a growing market for spirits

Don't want to miss the best from Business Standard?

Global alcohol consumption has dropped sharply over the past four years, hurting some of the world’s biggest liquor makers. Shares of Diageo, Pernod Ricard, Remy Cointreau and Brown-Forman have tumbled by as much as 75 per cent, wiping out nearly $830 billion in market value, Bloomberg reported.

 

What’s driving the decline?

 

Changing lifestyles, health awareness, and inflation have all pushed consumers away from alcohol. As a result, global beverage giants are rushing to reinvent themselves with non-alcoholic alternatives.

 

• Diageo recently bought Ritual Zero Proof, a maker of alcohol-free spirits

• Carlsberg and Campari-Milano have also launched similar “zero-proof” brands   

 

How bad are the numbers for liquor makers?

 

According to Bloomberg, shares of the world’s 50 leading liquor brands have fallen by an average of 46 per cent since June 2021. Analysts warn the downturn may continue as producers face weaker sales, high debt, and management changes.

 

How are drinking habits shifting worldwide?

 

The biggest challenge for the alcohol industry is changing consumer behaviour:

•  A Gallup poll in August showed US drinking rates at their lowest since records began in 1939

• Health warnings from the World Health Organisation (WHO) and the US Surgeon General have curbed demand, especially among Gen X

• Millennials and Gen Z view alcohol as less trendy, opting instead for wellness-oriented lifestyles.

 

How is pop culture influencing sobriety?

 

A growing number of celebrities are promoting sobriety.

• Actors like Tom Holland and Katy Perry have launched or endorsed non-alcoholic beverage lines.

• The rise of GLP-1 weight-loss drugs such as Ozempic and alternatives like cannabis have further dampened traditional alcohol sales.

 

Why is India an exception to this global decline?

 

While the world drinks less, India is drinking more.

• Per capita alcohol consumption in India has jumped from 2.4 litres in 2005 to 5.7 litres in 2016, and is expected to reach 6.7 litres by 2030.

• The Indian liquor market is now worth $60 billion.

• Shares of United Spirits, Radico Khaitan and Globus Spirits have risen up to 14 times in the last four years.

• State governments earned ₹19,730 crore in revenue from alcohol sales.

 

Which Indian states are driving the surge?

 

In just four years, alcohol consumption has surged dramatically in key Indian states:

• Madhya Pradesh: From 245.3 million litres in 2021-22 to 456.4 million litres in 2024-25, an 86 per cent increase.

• Rajasthan: From 235.9 million litres to 304.2 million litres, a 29 per cent jump.   

 

What’s behind India’s growing alcohol demand?

 

• Around 60 per cent of India’s population is under 35, driving demand, according to Future Market Insights.

• The WHO Global Report notes a 50 per cent increase in alcohol use among Indian women over the past two decades.

• Research from Statista and ReportLinker shows average incomes have grown by 30 per cent, and demand for premium liquor is rising by 18 per cent annually, Dainik Bhaskar reported.

 

What’s the big picture?

 

Global alcohol brands are losing value as drinkers worldwide turn sober, but in India, a young population is keeping the taps flowing.