new delhi indias per capital alcohol consumption is much lower at 55 litres compared with the global average of 62 litres and the east asia and pacific average of 64 litres according to a ubs report however the brokerage believes this is likely to go up because of certain regulatory changes such as lowering of excise dity in states like delhi west bengal and maharashtra as well as improved distribution in delhi and uttar pradeshtwenty five statesunion territories had increased duties on alcohol to offset some of the revenue loss during the pandemic however multiple states that had imposed additional taxes during the pandemic had a negative impact on their overall beverage volumes the confederation of indian alcoholic beverage companies ciabc had then suggested that states imposing a tax of over 25 would have lower tax revenue from liquor sales higher prices on account of increased excise duty lead to a double whammy for the states reduction in volumes as well as downtrading to cheaper optionsoverall sales in fy21 declined 116 yoy for the alcohol industryafter the initial hike in taxes many states have reduced or rolled back the additional duties imposed during the lockdown some state governments eg delhi are also lowering the drinking age improving distribution and introducing new excise regimes to boost revenue from liquor sales we believe such steps could be positive at an industry level as other states follow suit said sunita sachdev analyst at ubs