Key facts
- Industry bodies representing Diageo, Pernod Ricard, Heineken, and Carlsberg have raised concerns over $400 million in dues owed by Telangana.
- They accuse the state of breaching accounting rules by prioritizing new payments over older debts.
- The companies warn of significant bad debt risk due to the delayed payments.
- Telangana's system requires liquor companies to supply to state-run depots, making them reliant on government payments.
- The total amount of old outstanding dues was assessed at approximately $392 million.
Industry bodies representing major global liquor companies, including Diageo, Pernod Ricard, Heineken, and Carlsberg, have accused the southern Indian state of Telangana of breaching accounting rules. The companies claim the state owes them nearly $400 million in outstanding dues, warning of a significant risk of bad debt.
Under Telangana's system, liquor companies supply to state-run depots, which then sell to retailers, making the companies reliant on the government for payments. Industry leaders stated that while the state government has begun paying off new dues early this month, old debts are accumulating. They argue that the government is acting unilaterally by not prioritizing older debts, which contractually could be paid at a slightly lower rate with company agreement.
The Brewers Association of India, the Confederation of Indian Alcoholic Beverage Companies, and the International Spirits and Wines Association of India, collectively representing 80% of India's liquor, beer, and wine market, issued a joint statement highlighting the potential for unpaid old debts to become bad debts, creating a substantial financial burden. The statement assessed the amount owing for December 2025 to April 2026 dues at approximately 37.25 billion rupees ($392 million).
India presents a growing market for alcohol demand, but companies face obstacles such as high taxation, varying state regulations, and payment disputes. Pernod Ricard is also involved in an antitrust case and contesting a $314 million tax demand, while Anheuser-Busch InBev is fighting a competition law case.