Produce more beer this summer, breweries told
Excise wing puts pressure on breweries; funds a worry for firms
Tipplers like to chill with beer during summer. Some exult, even when they are sober, “summer and beer are made for each other!”
With summer fast approaching, the state government has started putting pressure on breweries to boost beer production to meet the entire expected increase in demand this year during the hot season and thereby help the Excise wing maximise revenues.
The Telangana Prohibition and Excise Department, having burnt its fingers last year, is leaving nothing to chance. Last year, the department -- one of the highest revenue-generating wings -- incurred revenue losses due to the failure of the breweries in the state to supply beer and meet fully the demand during the summer. Some wine shops were forced to display ‘beer – no stock’ boards for at least two weeks. As a result, the state government could not achieve the revenue targets set for the 2024-2025 financial year.
So, officials have started giving instructions to the breweries to arrange for the supply of beer to the licensed liquor shops and meet fully the huge demand in March, April, and May this year.
To avoid a repeat of the situation last year, Secretary to Excise Department Raghunandan Rao and top Excise wing officials are holding meetings with beer manufacturers. They are also visiting the breweries to take stock of the situation, well ahead of the beginning of the summer season.
Last year, 2.30 lakh beer cases were sold every day in the peak of summer and it is expected that the demand will increase to 2.50 lakh cases per day this year.
However, the big challenge before the breweries is to source enough funds for meeting the additional expenditure involved in beer production as per the diktat. For, according to the breweries’ managements, they are already in deep financial crisis due to nonpayment of the dues by the Excise wing for the last three years. On top of that, the Excise wing is mounting pressure on breweries for additional stocks without clearing the pending bills. “We have to find additional financial resources for increasing beer production without expecting any relief from the government. In case the demand for beer is lower than expected, stocks will be pile up in the warehouses and the breweries will plunge deeper into crisis,” the breweries’ association members said. Besides, the cost of the raw materials, wages for work forces, and transportation charges have increased in recent months.
Several appeals of the breweries to the government to increase the profit margin have fallen on deaf ears. The breweries are already making losses due to delayed payments and low margins, the association members averred.
