Karnataka to Discontinue Alcohol Price Controls from April

Thirsty young techies and professionals in the state home to India's Silicon Valley are expected to get easier access to a pint as authorities plan to scrap government-administered price controls on alcoholic beverages from April 2026.

Karnataka, home to the technology hub Bengaluru, is one of India's most lucrative alcohol markets, with its large base of young professionals and multinational workforce driving demand for premium brands from global drinks makers like Diageo, Pernod Ricard, Anheuser-Busch InBev and Carlsberg.

Shares of Indian alcohol makers, including United Breweries, Tilaknagar Industries and Radico Khaitan, rose following the policy announcement, with United Spirits, owned by Diageo, jumping 5.4 per cent and United Breweries, backed by Heineken, gaining 2.6 per cent.

India is the world's eighth-largest alcohol market with annual revenues of $45 billion; each state has its own regulations and pricing.

In Karnataka, the government controls retail alcohol pricing. Manufacturers declare ex-factory prices, based on which the state fixes the maximum retail price.

The state has among the highest alcohol taxes in India, with liquor classified into multiple price sections, each attracting an additional excise duty.

Karnataka now plans to introduce an alcohol-in-beverage-based excise duty structure that taxes alcohol based on its strength and reduce pricing categories to eight from 16, while allowing producers to decide on prices.

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