Three leading alcobev industry associations -- CIABC, BAI and ISWAI -- have asked the Telangana government to clear dues of Rs 3,151 crore payable to their suppliers of alcoholic beverages.
Issuing a joint statement, the associations have urged the state government to utilise money to be received from forthcoming retail licence auction to clear the dues payable to the industry.
Terming the situation an "existential crisis" for the alcobev industry in the state, they said many companies may struggle to maintain supplies in Telangana.
"Telangana's alcobev industry is undergoing an existential crisis as the delayed payments from the Telangana State Beverages Corporation Ltd (TGBCL) has crossed over Rs 3,151 crore, out of which over Rs 2,300 crore is more than a year old," the statement said.
This backlog has left supplier companies grappling with severe operational losses and unprecedented financial pressure, it added.
CIABC (Confederation of Indian Alcoholic Beverage Companies) represents the home-grown Indian-Made Foreign Liquor players, while ISWAI (International Spirits and Wines Association of India) represents the imported premium portfolio of spirits and wine brands in India.
BAI (Brewers Association of India) represents leading beer markers -United Breweries, ABInBev and Carlsberg.
"The tender process for the renewal of retail licence later this month is expected to generate a revenue of over Rs 3,000 crore, which should be earmarked for clearance of the money due to the industry for supplies made, a majority of which is pending for over a year now," the statement said.
In addition, the associations have also asked the state government to reduce the current advance excise duty from 30 per cent to 1 per cent as an interim measure to help improve working capital availability to the industry.
The associations highlighted that the state's excise revenue from alcobev sales soared to Rs 38,000 crore in FY24, becoming the highest contributor to the exchequer with 32 per cent share of the state's revenue.
Moreover, the sector also sustains thousands of jobs across manufacturing, logistics, allied industries, and retail.
"Despite its economic and social significance, the industry continues to be burdened with challenges that threaten its survival and its ability to continue business in a sustainable manner," they noted.
Over the last two weeks, officials of the three associations have been meeting senior Telangana government ministers and officials including the Excise Minister and the Deputy Chief Minister, urging them to immediately clear the outstanding dues.
"Sales are expected to increase 1.5 times when the new licences come into play in December 2025, as it also coincides with the festive season. Unless immediate steps are taken to address delayed payments, the industry may struggle to supply as per the demand, thus affecting not only the suppliers and the consumers, but also the state government by way of lower tax revenues," the associations said.
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The festive season demand can only be met if the suppliers have adequate financial resources, they added.
Issuing a joint statement, the associations have urged the state government to utilise money to be received from forthcoming retail licence auction to clear the dues payable to the industry.
Terming the situation an "existential crisis" for the alcobev industry in the state, they said many companies may struggle to maintain supplies in Telangana.
"Telangana's alcobev industry is undergoing an existential crisis as the delayed payments from the Telangana State Beverages Corporation Ltd (TGBCL) has crossed over Rs 3,151 crore, out of which over Rs 2,300 crore is more than a year old," the statement said.
This backlog has left supplier companies grappling with severe operational losses and unprecedented financial pressure, it added.
CIABC (Confederation of Indian Alcoholic Beverage Companies) represents the home-grown Indian-Made Foreign Liquor players, while ISWAI (International Spirits and Wines Association of India) represents the imported premium portfolio of spirits and wine brands in India.
BAI (Brewers Association of India) represents leading beer markers -United Breweries, ABInBev and Carlsberg.
"The tender process for the renewal of retail licence later this month is expected to generate a revenue of over Rs 3,000 crore, which should be earmarked for clearance of the money due to the industry for supplies made, a majority of which is pending for over a year now," the statement said.
In addition, the associations have also asked the state government to reduce the current advance excise duty from 30 per cent to 1 per cent as an interim measure to help improve working capital availability to the industry.
The associations highlighted that the state's excise revenue from alcobev sales soared to Rs 38,000 crore in FY24, becoming the highest contributor to the exchequer with 32 per cent share of the state's revenue.
Moreover, the sector also sustains thousands of jobs across manufacturing, logistics, allied industries, and retail.
"Despite its economic and social significance, the industry continues to be burdened with challenges that threaten its survival and its ability to continue business in a sustainable manner," they noted.
Over the last two weeks, officials of the three associations have been meeting senior Telangana government ministers and officials including the Excise Minister and the Deputy Chief Minister, urging them to immediately clear the outstanding dues.
"Sales are expected to increase 1.5 times when the new licences come into play in December 2025, as it also coincides with the festive season. Unless immediate steps are taken to address delayed payments, the industry may struggle to supply as per the demand, thus affecting not only the suppliers and the consumers, but also the state government by way of lower tax revenues," the associations said.
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