Total prohibition in Bihar forces liquor giants to rethink their business strategies

Nitish Kumar, the chief minister of Bihar, has announced total prohibition in his state - but, there is no ban on manufacturing of the products. The manufacturers can arrange to sell them outside the state. The implementation of total prohibition has compelled a number of liquor giants, who had set up breweries in the state, to rethink their business strategies which could end in wrapping up their business in the state.
This has been reported in telegraphindia.com dated 10 April 2016.

Understandably, some have openly expressed their disappointment on the method of implementation of prohibition and, others, while accepting it, have had to cut down on manufacturing and have begun to explore markets outside Bihar because, as per the new liquor policy, there are no restrictions in the manufacture of liquor in the state.
In the opinion of Danish beer giant Carlsberg, which has an operational brewery in Bihar since 2013, since it has made substantial in the state, such a decision would have an impact on the business. A systematic approach with focus on educating the consumers would have been a better option. The decision of the Bihar government has come as a disappointment especially for industries that are trying to set up their businesses here.
Carlsberg brewery had been set up at an initial investment of Rs 140 crore.
Similarly, the brewery of the UB Group, which started at Naubatpur (30-Km south of Patna) since May last year were apprehensive. The decision of total prohibition would translate into extra effort and more cost for a brewery to search for markets outside the state which will entail extra cost for the company in terms of transportation and permits. And - the prohibition could lead to unemployment and layoffs.


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