Introduction The use of Alcohol as drink is an age old story in India and it appears that the technique for fermentation and distillation was available even in Vedic Times. It was then called ‘Somarasa’ and was used not only for its invigorating effect but also in worship. To date, not only has the consumption of alcohol been continued but it is an integral part of the ayurveda system of medicine. Alcohol is one of the commonly consumed intoxicating substances in India. It has traditionally been drunk in tribal societies, although it has won increasing Social acceptance among other groups, urban males being the prime example. It is easily available and widely used, especially at festivals such as Deepawali and Holi. At the Moment the use of Alcohol is infrequent among women who also tend to resist the habit among male family members. Between 15 and 20 percent of Indian People Consume Alcohol and, over the past twenty years, the number of drinkers has increased from one in 300 to one in 20. According to The Hindustan Times, it is estimated that of these, 5 percent can be classified as alcoholics or alcohol Dependent. This Translated into about five million people addicted to alcohol. Of what is actually consumed, the Intake of Indian Made Foreign Liquor(IMFL) is growing at a considerable rate of 15 percent a year. Again, The Hindustan Times says that 65 percent of the Indian Liquor Market is controlled by Whiskey manufacturers. The State of Kerala stands first in per capita consumption of liquor at 8.3 liters followed by Punjab - 7.9 Liters. INDIAN LIQUOR BRANDS The Varieties of Alcohol Manufactured for Consumption in India are: 1. Beer 2. Country Liquor 3. Indian Made Foreign Liquor (IMFL) 4. Wines Indian Liquor Brands have registered significant growth in recent years – some of the top Indian Alcohol Brands showing an increase of as much as 50% in Sales (2006-2010). United Breweries registered an increase of nearly 20 percent in Sale in the year 2006-2007. Background Beer began to be exported to India in the early days of the British Empire, including porter and India Pale Ale, also known as IPA. The first brewery in India was set up in Kasauli, in the Himalaya Mountains, near Shimla, in the late 1820s by the Englishman Edward Dyer. Dyer's brewery produced Asia's first beer, called Lion. The brewery was soon shifted to nearby Solan (close to the British summer capital Shimla), as there was an abundant supply of fresh spring water there. The Kasauli brewery site was converted to a distillery which Mohan Meakin Ltd. still operates. Dyer set up more breweries at Shimla, Murree, Rawalpindi and Mandalay. Another entrepreneur, H G Meakin, moved to India and bought the old Shimla and Solan Breweries from Edward Dyer and added more at Ranikhet, Dalhousie, Chakrata, Darjeeling and Kirkee. In 1937, when Burma was separated from India, the company was restructured with its Indian assets as Dyer Meakin Breweries, a public company on the London Stock Exchange. Following independence, in 1949 N.N. Mohan took over management of the company and the name was changed to Mohan Meakin Ltd. The company continues to produce beer across India to this day and Lion is still available in northern India. Lion was changed from an IPA to a lager in the 1960s, when due to East European influence, most brewers in India switched from brewing Ales to brewing lagers. Today no brewer in India makes India Pale Ale. All Indian beers are either lagers (4.8% alcohol — such as Australian lager) or strong lagers (15 % alcohol - such as Australian Max super strong beer). In various parts of north- eastern India, traditional rice beer is quite popular. Several festivals feature this nutritious, quite intoxicating, drink as part of the celebrations. The rice is fermented in vats that are sometimes buried underground. Elephants are known to attack villages, with the primary agenda of drinking from these vats. Following one such raid in north-eastern India, a police officer in Dumka was quoted in the press as saying: "Tribals who love rice beer brew the liquor at home. Elephants too are fond of this beer. Often it is found that, attracted by the strong smell of the liquor, wild elephants tear down the tribal houses where the brew is stored." Viticulture was believed to have been introduced to India by Persian traders sometime in the 4th millennia BC. Historians believe that these early plantings were used mostly for table grapes or grape juice rather than the production of an alcoholic beverage. During the Vedic period of the 2nd and 1st millennia, the Aryans tribes of the region were known for their indulgence of intoxicating drink and it seems probable that wine was a present beverage. The religious text of the Vedas mentions at least one alcoholic drink that may have been wine related-sura which seems to have been a type of rice wine that was fermented with honey. The first known mentioning of grape-based wines was in the late 4th century BC writings of Chanakya who was the chief minister of Emperor Chandragupta Maurya. In his writings, Chanakya condemns the use of alcohol while chronicling the emperor and his court's frequent indulgence of a style of grape wine known as Madhu. In the centuries that would follow, wine became the privileged drink of the Kshatriya or noble class while the lower caste typically drank alcohol made from wheat, barley and millet. Under the rule of the Muslim Mughal Empire, alcohol was prohibited in accordance to Islamic dietary laws. However there are written reports about at least one Mughal ruler, Jahangir, who was fond of brandy wine. In the 16th century, Portuguese colonists at Goa introduced port-style wine and the production of fortified wines soon spread to other regions. Under British rule during the Victorian era, viticulture and winemaking was strongly encouraged as a domestic source for the British colonists. Vineyards were planted extensively through the Baramati, Kashmir and Surat regions. In 1883 at the Calcutta International Exhibition, Indian wines were showcased to a favorable reception. The Indian wine industry was reaching a peak by the time the phylloxera epidemic made its way to country and devastated its vineyards. It was a long road for the Indian wine industry to recover from the devastation at the end of the 19th century. Unfavorable religious and public opinion on alcohol developed and culminated in the 1950s when many of India's states prohibited alcohol. Vineyards were either uprooted or encouraged to convert to table grape and raisin production. Some areas, like Goa, continued to produce wine but the product was normally very sweet and highly alcoholic. The turning part of the modern Indian wine industry occurred in early 1980s with the founding of Chateau Indage in the state of Maharashtra. With the assistance of French winemakers, Chateau Indage began to import Vitis vinifera grape varieties like Cabernet Sauvignon, Chardonnay, Pinot blanc, Pinot noir and Ugni blanc and started making still and sparkling wines. Other wineries soon followed as the emergence of India's growing middle class fueled the growth and development of the Indian wine industry. LITERATURE REVIEW Highlights of Indian Alcohol Industry The Indian alcoholic drinks market generated total revenues of $13.9 billion in 2009, representing a compound annual growth rate (CAGR) of 12.5% for the period spanning 2005-2009. The Indian beer market generated total revenues of $4 billion in 2009, representing a compound annual growth rate (CAGR) of 20.3% for the period spanning 2005-2009. The Indian wine market generated total revenues of $254.2 million in 2009, representing a compound annual growth rate (CAGR) of 20.4% for the period spanning 2005-2009. Potential of Liquor Market in India It is India’s Potential for Whiskey – it accounts for about 60 percent of the Indian Made Foreign liquor (IMFL) market – and other spirits such as Rum and Vodka that is attracting MNCs to India. They reckon that India is a big and growing market with a weakness for spirits, especially whiskey. This is not surprising considering that in the wake of the reforms, as the social transformation gathered momentum and global consumption patterns get increasingly assimilated, the country’s moral fabric is loosening. Drinking liquor has rapidly Gained acceptance and is no more taboo – even among the conservative middle class but whose attitudes have changed with improved standard of living. Liquor Companies have been quick to latch on to this trend. Groupe Pernod Ricard, the world’s fifth largest producer of alcoholic beverages, will be introducing new brands for the growing middle-class market. In fact, the youth, women and middle- class – overlapping segments —are being targeted by the liquor companies looking for growth. A good example of this potential is the per capita beer consumption placed at half-a-liter for India, in contrast to the Czech Republic’s consumption of half a liter a day. It is also hardly comparable to the very high levels of per capita beer consumption in developed and some of the developing countries. But the emerging trends are interesting. Strong Beer(alcohol content in excess of 5 percent), a category non-existent in developed countries, has been growing at about 15 percent in India for the last few years, and already accounts for 55 percent of beer consumption. This trend is slated to continue. Thus, there is Significant latent demand and vast scope for growth in liquor consumption, both in the urban and prosperous rural areas, once the regulatory environment is relaxed.