Beer, soft-drinks to get costlier in Maharashtra

A beer tasting session at Andheri's craft brewery Brewbot. File pic

The state government's move to increase the water cess for breweries and bottling plants in the city - which is expected to generate Rs 300 crore in revenue - might be harder to gulp for major beer manufacturers. Last week, the state proposed to increase the water cess by a substantial markup, which would make bottled water and soft drinks, including craft beer, more expensive. While the Maharashtra Water Resources Regulatory Authority is in the midst of processing the approval, breweries will end up paying anywhere between Rs 200 to Rs 400 per 10,000 litres compared to the previous Rs 45 to Rs 90.

But, Ansh Seth, co-founder and director of finance and administration at Brewbot Eatery and Pub Brewery, Andheri West, says, "Only big brands might face the heat since their scale of manufacturing is larger. It is true that a difference will be observed for micro-breweries as well, but not as much."

The big trouble
Brewbot, which is one of the city's largest micro-breweries, produces more than 15 different styles of craft beers. "At any given time, Brewbot serves between six to eight styles of craft beer on tap," Seth says.

Another pinch
Seth also points out that the hospitality sector had barely recovered from demonetization and the Goods and Services Tax (GST), when it has been hit with the water cess hike. "While the initial days of GST may seem unpleasant, it is a landmark reform and will have a positive effect in the long run. The water hike will definitely impact the industrial scale of manufacturing and add to the damage, with a surge in pricing of affected products and categories."