INDIA: Indian alcohol ad ban worries multinationals but domestics to consolidate

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The Indian liquor market has been divided by the Indian Government's ban on liquor advertisement across television channels, which takes effect from today.

The Indian press has reported opposite responses to the setback when The Information & Broadcasting (I&B) Ministry amended the Cable Network Act banning liquor advertising on satellite channels.

Multinationals such as UDV and Bacardi-Martini have reacted sharply and asked the Confederation of Indian Alcoholic Beverage Companies (CIABC) to negotiate with the ministry to revoke the amendment.

However, India's leading domestic producer The UB Group, has indicated it will take the ban as an opportunity to consolidate, according to the Indian press. UB's chairman Vijay Mallya apparently told company shareholders last week that, "yes. I think the ban will work to our advantage. Brands like McDowell's No1 whiskey will be able to shave off competition from multinational companies and their brands. It will help us to regain the lost ground."

However according to Business Line, executives of the multinationals were "exasperated" by the response of the domestic companies to the ban and efforts to get it lifted.

The paper said that the ban was expected to adversely impact the bottom lines of most multinationals.

Bacardi-Martini was reported to have put off the shoot for a new television commercial on Bacardi Reserva rum. Mahesh Madhaven, general manager marketing Bacardi-Martini India said: "We want to know where we are headed before deciding to go ahead with the shoot."

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