India’s liquor industry is increasingly betting on the so-called Hindi heartland Uttar Pradesh, Rajasthan, Haryana, Jharkhand and Chhattisgarh as the next big growth engine for premium spirits, with companies expanding luxury portfolios and launching craft brands in states traditionally seen as volume-driven, mass-market territories.
The shift is being enabled by state governments themselves. States once viewed as conservative on alcohol policy are now actively reforming their excise frameworks to attract investment and boost premium consumption. Uttar Pradesh has introduced measures to position itself as an export hub for liquor manufacturing while easing business conditions for premium brands. Haryana has expanded premium retail formats under its excise policy, and Rajasthan is modernising its retail licensing and premium outlet formats.
Sanjit Padhi, Chief Executive of the International Spirits and Wines Association of India (ISWAI), described the broader shift as part of India moving “from a savings society to a consumption society,” driven by rising disposable incomes, social media exposure and changing lifestyles. He noted that premiumisation also benefits state finances directly, since consumers trading up to costlier products end up paying higher excise duties a key reason states are becoming more accommodating towards the industry.
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Industry executives say premiumisation is no longer limited to whisky. Anant Iyer, Director-General of the Confederation of Indian Alcoholic Beverage Companies, pointed to rising consumer interest in craft gin, flavoured vodka, premium rum and Indian single malts across UP, Haryana and Rajasthan. He added that cocktail culture, once confined to metros, is now visible in cities like Lucknow, Kanpur, Jaipur and Chandigarh.
Several domestic companies are actively building out their premium portfolios in these markets. Radico Khaitan said UP and Rajasthan are emerging as major growth markets, with brands such as Rampur Double Cask, Sangam World Malt and The Spirit of Kashmyr expanding across the region. The company’s prestige and above segment recorded 28.5 per cent volume growth and 30.9 per cent net sales growth in 2025-26.
Tilaknagar Industries, maker of Monarch Legacy brandy, said premiumisation potential in these states remains significant despite an already-higher base salience of premium products compared to the national average. The company has expanded offerings including Seven Islands and Monarch Legacy Edition, while also investing in craft spirits maker Spaceman Spirits Lab.
Craft gin and spirits maker Nao Spirits & Beverages, known for Greater Than and Hapusa, expects Hindi heartland states to contribute close to 20 per cent of its overall revenue within the next two years, with demand currently concentrated in cities like Jaipur, Udaipur, Jodhpur, Gurugram and Faridabad.
The premium beer segment is showing similar momentum. Woodpecker Distilleries & Breweries, under the Bhopal-based Som Group, said premium beer’s share has risen 8-10 per cent over the past year in states like UP, Odisha and Jharkhand, with UP alone recording nearly 30 per cent premium beer salience among the highest in the country provided pricing stays within 1.2 to 1.3 times that of mainstream beer.
Despite the optimism, industry bodies continue to flag structural constraints. Padhi said states should consider giving companies greater flexibility on pricing and distribution to sustain the momentum. Even so, players like Piccadily Agro Industries maker of Indri single malt believe the shift is still in its early stages, with affluent consumers in emerging Tier-II cities increasingly willing to pay for globally benchmarked Indian brands rather than simply buying on volume. This report is based on original reporting by Business Standard.
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