European alcoholic beverage companies have urged India to temporarily waive import duties on key packaging materials as shortages of glass bottles and aluminum cans loom due to disruptions linked to the Middle East conflict, according to a letter seen by Reuters.
The request was made by the Federation of European Businesses in India, whose members include major global firms such as Pernod Ricard, Anheuser-Busch InBev, Heineken, and Carlsberg.
In its April 2 letter, the group requested an exemption from the 10% import duty on glass bottles and aluminum cans, warning that local manufacturers are struggling to operate at full capacity. The الأزمة has been exacerbated by supply disruptions stemming from the ongoing Iran conflict, which has pushed up costs for packaging materials including cartons, labels, and adhesives.
India’s $65 billion alcohol market is already grappling with cost increases of up to 15%, industry sources say. Passing these costs on to consumers remains difficult, as retail price adjustments require government approval in around two-thirds of the country’s 28 states.
The Federation warned that sourcing packaging materials from alternative countries could increase costs by as much as 30%, further straining the industry. India’s commerce and finance ministries have not yet responded to the request.
Data from Euromonitor shows that Heineken leads India’s beer market, while Diageo and Pernod Ricard dominate the spirits segment by volume. Meanwhile, industry estimates suggest the Indian alcohol market is set to grow at nearly 8% annually through 2033, making it one of the fastest-growing globally.
Industry group Brewers Association of India said beer companies have already sought price hikes in several states to cope with rising costs. Its Director General Vinod Giri noted that domestic supply of bottles and cans has dropped significantly due to the war, forcing companies to consider imports.
Global prices for glass and aluminum have also surged, compounded for Indian importers by a weaker rupee. Some companies are now exploring sourcing options from Southeast Asia amid concerns that shortages could begin as early as May.
The الأزمة is further complicated by energy constraints. India has reduced supplies of liquefied petroleum gas to commercial users, while imports of liquefied natural gas—critical for glass manufacturing—fell to their lowest level since January 2025.
Although the U.S. and Iran recently agreed to a temporary ceasefire, shipping through the Strait of Hormuz remains disrupted, continuing to affect global supply chains and raising uncertainty for manufacturers.
The situation highlights how geopolitical tensions are rippling through global trade, putting pressure on one of the world’s fastest-growing consumer markets.