30 microbreweries shut shop in 2019

Gurugram The city’s microbrewery business witnessed a major dip in 2019 owing to the decision of the Delhi government to allow the setting up of such establishments

Gurugram The city’s microbrewery business witnessed a major dip in 2019 owing to the decision of the Delhi government to allow the setting up of such establishments in the national capital as well as due to steep competition among the city-based outlets. Excise officials said that of the 80 microbreweries, around 30 surrendered their licences in 2019.

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Most of these outlets are located in CyberHub, Sector 29, Sohna Road and Golf Course Road, and the production capacity of each varies from 50 litres to 500 litres per day.

The Haryana government’s new liquor licensing policy, released in March 2019, had given relief to brewery owners as they did not have to pay additional fees to run a restaurant. Owners can run a restaurant with a single brewery licence, which costs ₹20 lakh. The annual licence fee to run a microbrewery and a restaurant earlier used to cost ₹30 lakh.

However, brewery owners are unhappy over the licensing cost, on the grounds that it is still costly.

Ishan Grower, the founder of IG Brewtech, said that the licensing fees to operate a brewpub (brews and hard liquor) compounded additional rent, excise fee and other overheads, amounting to around ₹60 lakh, are denting the business. Excise fee for one bulk litre of the brew is ₹28, he said.

“High rentals in the city is also one of the reasons. Oversupply and competition among the outlets offer a cheap price. Even coffee is expensive these days, when compared to beer. The online platforms are also killing our business, as people get offers for the outlets that are cheaper but do not give the provide quality,” he said.

Owners of restaurant, pubs and clubs are unhappy with the new policy as the annual licence fees to run a restaurant has been increased from ₹15 lakh to ₹18 lakh, which is the highest in the National Capital Region.

“The annual excise licence fee for restaurants in Haryana is already the highest among all northern states. Instead of rationalising it, there has been an increase in the fee, which is a major concern for us,” Rohit Mann, director of Raise the Bar brewery at Clarens Hotel in Sector 29, said.

Mann said those wanting to operate till 1am have to shell out an additional ₹10 lakh per year, whereas establishments in Delhi are allowed to operate till then without additional duty.

The annual licence fee for the microbrewery was also increased despite the fact that neighbouring Delhi has also allowed setting up of such outlets, said city-based operators. They said that in view of the expensive fee in Gurugram, many of them could close and shift to Delhi, which could cause revenue losses to the state.

“Unless the Haryana government takes pragmatic decisions and reduces fee so that city-based operators can breathe easy and compete with compatriots across NCR, the scenario will remain gloomy,” an owner said.

“We have reduced the licence fees to run microbreweries in view of the stiff competition faced by operators in the city. The department will take all measures to help the industry in Gurugram so that neither the businessmen face losses nor is there a fall in revenue,” said HC Dahiya, deputy excise and taxation commissioner.

The Haryana Cabinet, in February 2008, had approved licences for “Ice Bars” and “Micro Beer Brewery Pub” to provide liquor at zero degrees Celsius and brew beers in front of the consumer. Pune was the first to introduce such a brewery, with Doolally being the first microbrewery in India.

Haryana was second to introduce the concept (Rockman Beer Island in Ambience Mall and Howzatt in Galaxy Hotel, Sector 15), followed by Karnataka and Punjab. The licence fee for ice bars and pubs was kept at ₹1 lakh and ₹2.50 lakh, respectively, but in 2018, the fee was increased to ₹10 lakh per annum.