New data indicates that India’s spirits market is poised for significant growth over the next five years, with an anticipated 3% volume increase. Tequila, in particular, is forecast to experience double-digit expansion, demonstrating a shifting consumer palate beyond traditional preferences.
According to IWSR data, the value of spirits in India is projected to see a compound annual growth rate (CAGR) of 4% from 2025 to 2030, outpacing the 3% volume growth. This follows a robust performance last year, where spirits recorded a 4% volume gain and a 6% value increase.
Jason Holway, IWSR senior research consultant, attributes this growth to a burgeoning consumer base. “The biggest driver is the growth in consumers, both new legal-drinking-age consumers and triallists,” Holway explained. He noted that these groups possess increasing disposable income and a growing curiosity, prompting brand owners, importers, and distributors to introduce a wider array of products through evolving market channels.
Free trade agreements, such as the recent UK-India deal, are expected to further stimulate this trend by making imported spirits more affordable. Potential adjustments to state excise regimes could also broaden consumer choices, Holway suggested.
Agave spirits have emerged as a significant growth area. IWSR data reveals that Tequila volumes surged by 34% in 2025, with an even more substantial 66% increase in value. From 2019 to 2025, the Tequila category experienced a 32% CAGR in volume and a 48% rise in value. This upward trajectory is predicted to continue, with Tequila volumes forecast to grow at a 13% CAGR and value at 15% from 2025 to 2030.
Despite the rise of other spirits, whisky continues to dominate the Indian market in absolute volumes. Both domestic and imported whiskies are expected to maintain their growth momentum. Last year, Indian whisky saw a 4% volume gain, while Scotch whisky increased by 5%. Over the next five years, Scotch whisky is projected to slightly outpace Indian whisky, with a 6% CAGR volume rise compared to 4% for Indian whisky. In terms of value, Scotch is anticipated to increase by 5%, and Indian whisky by 4% during the same period.
Vodka has been a strong performer recently, driven primarily by flavored variants, though non-flavored vodkas also show growth. The vodka category is expected to achieve a 5% increase in both volume and value CAGR in the five years leading up to 2030, building on last year’s double-digit gains of 14% in volume and 12% in value.
Gin has also benefited from a burgeoning “cocktail culture,” which Holway describes as an “urban phenomenon.” Last year, gin in India saw an 11% increase in value and a 3% rise in volume. Projections for 2025-2030 indicate a 5% volume gain and a 7% value increase for gin.
While still a very small segment, non-alcoholic “spirits” have shown remarkable growth. Accounting for less than 0.001% of total spirits volume in India, this category experienced an astonishing 369% volume increase and a 374% value increase last year. Forecasts suggest a continued CAGR rise of 56% in both volume and value from 2025 to 2030.
Holway highlighted Uttar Pradesh, Andhra Pradesh, and Kerala as states where recent improvements in retail infrastructure have fostered better conditions for alcohol sales. These improvements are expected to particularly benefit the brandy category, which traditionally sees strong performance in southern Indian states.
In a move to promote local production, the Maharashtra government introduced a state-specific alcohol category last summer, significantly cutting excise taxes to 270%. Holway noted, “Maharashtra-made-liquor (MML) is settling down and offering opportunities to a revived in-state distilling industry.”
Despite the promising growth, the complex regulatory landscape remains a significant challenge for the industry. “With India being a key growth market, everybody is looking for potential partners with momentum,” Holway stated. He added that the intricacies of state-by-state brand building can slow early growth, making it advantageous to partner with companies that have already navigated these initial stages. Consequently, Holway anticipates increased merger and acquisition activity as global spirits companies seek local partners to expand their presence in the Indian market.
