Need ease of doing business at state level too: Diageo India

India’s efforts to make life simpler for businesses to boost economic activity seemed to have paid off when it jumped 30 places to break into the top 100 in the World Bank’s Ease of Doing Business rankings last year.

For one industry, however, the change is yet to be experienced—alcoholic beverages (Alcobev). The same zeal to improve ease of doing business that was visible at the Centre needs to be seen at the state level as well, said Anand Kripalu, managing director and CEO of Diageo India, at an event in Mumbai on Thursday.

“Alcobev is regulated entirely by states. Just one factory, for example, in Maharashtra requires a large number of approvals within the same year, just to continue doing business...we need fundamental changes,” he said.

Capping price rise, he said, won't help the industry at all. “Price control is essential for products such as milk, sugar, etc. But alcohol is capped at the top level for price rise...some states don’t allow a price increase for as long as five years," Kripalu said.

He also pointed out that post GST, the alcobev industry is a major contributor to states’ revenue. “We have also been left out of GST, so we don’t have the benefit of a common market,” he lamented, adding that sometimes Diageo has to shell out big bucks just to move goods between factories.

Responding to Kripalu’s comments, NITI Aayog chief executive officer Amitabh Kant, who was also present at the event, said: Bringing liquor under GST is key...doing so will go a long way towards addressing the issues Kripalu has raised.