Beer consumption set to double every 3 years

Bengaluru: India’s per capita consumption of beer is set to double every three years thanks to a boom in craft beer sold at micro-breweries. Currently, the per capita beer consumption is pegged at 2 litres, and has stagnated at this level for many years due to regulatory hurdles, taxation issues and age limits.

Bengaluru, which is hailed as the beer capital in the country, will be once again leading the growth in the industry. The city, which is home to 86 out of 600 micro-breweries in the country, is likely to witness ten times growth in the number of micro-breweries in the next eight years, thereby leading the growth in the beer consumption, according to Shivkumar Eswaran, Chairman of Indian Chamber of Commerce, South India Council and Chairman of Canadian Crystalline Water India Limited.

By 2033, he said, India will have an estimated 5,000 micro-breweries, and the  craft beer segment sales is expected to witness an exponential growth of 23.4% CAGR to touch $33.3 billion from $4.7 billion recorded in 2024. Micro-breweries will account for about 45% of the total sales in the country. Also, the per capita consumption of beer would be in the range of 8 litres in that year, he said.

“The per capita consumption in India is about two litres compared to a global average of 30 litres. In India, the age restriction needs to be eased to 16 years for consumption of beer with less than 4.5% alcohol content. We also need a uniform excise duty on beer and alcohol across the states to give a push to the industry,” Eswaran said.

Another reason for low consumption of beer in India is that the country is predominantly a consumer of hard liquor like whisky, brandy, gin, and vodka unlike the US and Europe where beer and wine consumption is higher. Beer is considered a non-alcoholic drink in those countries, he said.

However, the trend is slowly changing in India, and the awareness is growing towards the consumption of beer and wine. The rapid growth in the opening of micro-breweries across the country is adding to the steady growth in the beer consumption, Eswaran said.

According to beer industry leader United Breweries, consumer preferences are changing with rising disposable incomes, urbanisation, and a young population. A notable trend is the increasing demand for low and no-alcohol beers, particularly among Gen Z and millennials who prioritise health and moderation. Brands like Heineken 0.0 are gaining traction in metropolitan areas, prompting companies to innovate to meet this demand without compromising the traditional beer experience.

Eswaran added that unlike bottled beer which comes in limited varieties, micro-breweries offer a large variety of beers. There are at least 6-8 types of flavours offered by each micro-brewery in India. All of them together provide around 180 varieties of beer to consumers, and this variety is attracting a newer set of consumers, he said.

All these factors are contributing to the growth of the beer industry in India. The value of beer sold in India is expected to witness a massive growth from the present $5.4 billion to $802 billion by 2033, Eswaran said.

Cut-off box - Opportunities for growth
As consumer awareness and accessibility improves the industry is well-positioned to drive higher penetration particularly in emerging urban centres and Tier-2 & Tier-3 cities.
The Indian beer market is segmented into Strong and Mild Beers. Alongside this there is a pronounced trend towards premiumisation with premium beer segments expected to outpace overall category growth. Despite challenges such as regulatory hurdles and taxation issues the Indian beer industry presents substantial opportunities for growth and innovation. Companies that can adeptly navigate these complexities embrace innovation and align with evolving consumer preferences are well-positioned for success United Breweries said in its annual report.