Indian whisky

Slowly – very slowly – but surely, the various strands that make up the Indian whisky market are coming together. Could the sub-continent make a significant contribution to world whisky? asks Dominic Roskrow

It’s early evening and darkness is rapidly spreading over Bangalore. It’s rush hour – or, more accurately, rushier hour given that it’s always a rush in Bangalore - and tuk-tuks battle bikes and motorbikes in the half light.

I’ve been invited by my host at Amrut to witness after-work ‘happy hour’ at first hand. But it’s anything but. I had expected a hotel bar or pub of some description. What I get is a soulless room with a tiled floor and shelving around all four walls. There are no tables or chairs. It smells faintly musty and of stale urine. It reminds me of the waiting rooms that British Rail used to have in the ’70s in places such as Derby and Stoke.

“Watch this,” shouts my host as a shabby-looking man arrives at the counter of the adjoining bottle shop. He buys a small bottle of whisky – 20cl perhaps – then enters our room, pours the whisky into a plastic cup, drinks it in one swallow and exits again.

Meanwhile my host is beside himself with glee and excitement, almost hoping from leg to leg as he points and shouts: “See, that’s how these Indians drink whisky. Look! Another one!”

It is pitiful. Each man entering goes through exactly the same procedure. They must have heard my host, must have known they were being mocked, but none of them looked up. I am embarrassed and can’t leave quickly enough – for all sorts of reasons.

Here, though, was as good a metaphor for Indian whisky as any. A clash between castes and classes, between haves and have nots, and between the high-end of Indian whisky, which prime Indian producer Amrut represents, and the cheap soulless whisky reality for much of the vast Indian population.

Indian whisky is in a category all its own. And if that sounds like stating the blindingly obvious, then the reason is not because it’s Indian. It’s because to understand it we have to treat it differently to whisky from any other part of the world.

Let me explain. If this were a feature about scotch whisky, you’d expect it to be about whisky from Scotland, rather than whisky in it, wouldn’t you? In fact you’d find it downright odd if the heading said ‘scotch whisky’ and the content was all about bourbon sales in Glasgow. The same is true for every other country’s whisky.

But not India’s. And that’s because Indian whisky is a curio, the North Korea of whisky, existing in independence and isolation in an interactive world, a colossus within its own borders but cut off by an iron curtain of tariffs and taxes. Meanwhile, the rest of the world shuns it, arguing that much of the country’s spirit shouldn’t even be classed as whisky at all. For this reason Indian whisky is unique, and the ‘happy hour’ experience brings it into sharp focus. 

There are about 1.3 billion people in India, making it a potentially huge and lucrative marketplace. But as we all know, there is a vast chasm between the poor and the increasingly wealthy. About a quarter of the population has been benefiting from India’s economic growth – that’s 325 million people, not far off the total population of the United States and about 40% the size of the whole of Europe. 

Unlike new territories such as China or South America, India has a history of whisky consumption and an understanding of the drink inherited from the days of the Raj. 

But whisky as we know it is beyond the reach of the cast majority of Indians and, as Amrut executive director Rick Jagdale put it to me: “People in India are starving and barley is food. It is in that direction it must go first.”

In fact there are four distinct and separate strands to the Indian market: the huge standard blended whisky market aimed at the vast majority of the population; a growing premium blended whisky market often with Scottish malt mixed with Indian grain, aimed at the emerging middle classes; a small but increasingly significant imported whisky market, mainly for Scottish single malt; and Indian single malt whisky made by Amrut and John Distilleries.

Speak to anyone about the Indian internal market and a) you’ll note a tone of very cautious optimism and b) before long you’ll hear the words ‘slowly’ and ‘surely.’ With more emphasis on slowly.

Richard Paterson, master blender for Whyte & Mackay, which was owned by Indian entrepreneur Vijay Mallya before Diageo bought Mallya’s United Spirits, has visited India on numerous occasions.

“Things are changing there but it’s very difficult,” he says. “The import tariffs are very restrictive and each state has its own approach to tax. Some have reduced taxes but it is such a vast place to do business in.”

Krish Kumar, general manager for international sales and marketing at John Distilleries, says there is an increased interest in single malt whisky in India, not just for scotch but for world whiskies and, for the first time, for the likes of his company and Amrut.

“Whiskies in India are on the up at the moment,” he says. “There is a serious increase in the number of tasting clubs and experts in India, who have been enjoying some lovely whiskies. This is where different cultures meet and Indians are loving the tasting sessions where they can enjoy whiskies from different parts of the world.

“We have been conducting several tasting sessions in Goa and have just started engaging in building up the excitement across Bangalore as well. These sessions are eagerly looked forward to and loved by India’s whisky connoisseurs.”

Bangalore is India’s food and drink state, and Goa its most liberal, so perhaps the success of imported spirits is not so surprising. But while the potential of the Indian market is immense, it needs to be put into perspective. In 2013 the top 10 whiskies in India sold about 120m cases, with leading brands Officer’s Choice and McDowell’s almost equally boasting just under 24 million cases each. Single malt whisky in India is all but statistically insignificant in comparison.

Of greater interest, perhaps, is the substantial growth of premium domestic blended whiskies. Officer’s Choice Blue Label, for instance, was launched by Allied Blenders to compete with Pernod Ricard’s Royal Stag, which is India’s fourth best-selling whisky. It is selling in the region of four million cases now, nearly enough to get it into the national top 10 in its own right.

These whiskies are giving the growing middle class a taste of Scottish whisky, even if it is diluted by Indian grain. But if change has been slow, it hasn’t been a lot better for the two distilleries exporting to the rest of the world. After Amrut’s impressive flurry of awards and critical acclaim, the past two years have been relatively quiet. And John Distilleries hit the ground running with a solid core range and some exciting single cask bottlings.

Both, though, have lost direction to some extent. Ashok Chokalingam, Amrut’s head of international operations, moved from the UK back to distillery headquarters in Bangalore while the Paul John brand seemed to lose its way last year when the company’s main European brand ambassador stood down. Krish Kumar’s appointment has at least put everything back on track. 

Both companies seem to have had stock issues but both are adamant that we are in the calm before an Indian storm.

Chokalingam isn’t prepared to give too much away about his company’s plans. But this year, at least the company has plans. “These are exciting moments I guess,” he says. “Changing colours and hands of the businesses, new opportunities, more challenges and, in a nut shell, it is a ‘Bombay mix’ of good and bad.

“In the past 12 months we have repositioned our strategic direction in the international markets in terms of sales and distribution. We see opportunities exist both in the domestic market and international markets. “We are slowly but steadily expanding both on the domestic and international markets. This year we will have a couple of new releases and will be raising our own already high bar.”

Paul John is also intending to release a new expression in the coming few months and Kumar says the company is growing nicely.

“Our plan for the next 12 months is to keep things very simple and not over complicated,” he says. “We have a brand value that we will maintain and build strategically. John Distilleries will continue to cater for the Indian markets as have been doing for the past 23 years, and Paul John will keep spreading the joy of an absolute gem of a single malt.

“We have very good partners across the board in the UK and Europe. As I always say, you need to do better than what you did yesterday, so the graph is definitely going onwards and upwards.”

So can the three strands come together? Eventually, it seems. Amrut and Paul John are pursuing a domestic and international business strategy, and consumption of quality scotch whisky is on the increase. The question now is whether India can follow the rest of the world and create a sizeable single malt market of its own? Tricky one.

“If only I could predict the future I would be Guru Krish Maharaj,” says Kumar. “India is one of the most trending countries these days, Indian culture has always been renowned. Being Indian is very fashionable. Are Indian whiskies the ones to look out for? Emphatically, yes indeed we are.”

Chokalingam sets his sights high. “The future is bright for sure, and it is a matter of time and how aggressive we want to be,” he says.“It is anybody’s world and there is an opportunity for everyone. From our perspective, any new player that wants to enter into the market is welcome as long as they maintain and enhance the reputation of Indian whisky that Amrut has created in the international market. “If that’s the case then the Indian whisky category can be like the Japanese whisky category in the years to come.”

That’s a big ask. Don’t be so sure it will happen. And if it does come about, expect it to do so slowly. Very slowly indeed.