French spirits giant Pernod Ricard remains locked out of one of India’s most important alcohol markets after the Delhi High Court upheld a government decision to deny the company a wholesale liquor licence, extending a regulatory battle that has dragged on for more than three years.
The ruling, delivered on 29 May, means Pernod Ricard India cannot resume wholesale operations in New Delhi, despite India having become the group’s largest market globally by volume.
According to the court’s decision, the company’s application for L1 wholesale liquor licence was rejected by Delhi’s excise authorities because Pernod Ricard India remains under investigation in connection with the 2021 Delhi Excise Policy case and has been named as an accused party in a money laundering probe conducted by India’s Enforcement Directorate (ED).
The L1 licence is a critical permit within Delhi’s alcohol distribution system. Licence holders are allowed to store, wholesale and supply alcoholic beverages to retail outlets. Without it, a company cannot participate directly in the local market as a licensed wholesaler.
In its petition, Pernod Ricard argued that it had not been convicted of any offence and therefore should not be treated as having a criminal background or be disqualified from obtaining a licence. The company also pointed out that, in February this year, a court handling the underlying excise policy case discharged all accused parties, potentially weakening the legal basis for the related money laundering proceedings.
The Delhi High Court, however, sided with regulators.
The court ruled that under the Delhi Excise Act, licensing authorities retain discretionary powers when issuing permits. As a result, the absence of a criminal conviction does not automatically entitle an applicant to receive a licence.
The decision means Pernod Ricard has now been unable to restore its wholesale operations in Delhi for three consecutive years.
A Regulatory Storm Years in the Making
The licensing dispute stems from one of India’s most closely watched political and business scandals in recent years: the Delhi Excise Policy case.
In 2021, the Delhi government introduced a new excise policy aimed at increasing private-sector participation in alcohol retailing while overhauling the city’s wholesale and retail licensing framework.
The policy was later investigated over allegations of irregularities in licence allocation and profit-sharing arrangements and was ultimately scrapped in 2022.
India’s Central Bureau of Investigation (CBI) and Enforcement Directorate subsequently launched separate investigations, widening the scope of the case and drawing in politicians, alcohol distributors and major beverage companies.
According to documents filed by the Enforcement Directorate, Pernod Ricard allegedly provided corporate guarantees to partner banks, which then extended loans to certain retailers bidding for liquor retail licences.
The agency argues that such arrangements may have violated provisions of the Delhi excise policy that prohibited manufacturers from directly or indirectly participating in retail operations and may have helped the company expand its market share.
Pernod Ricard has denied the allegations, maintaining that it has complied with Indian laws and emphasising that no final judicial ruling has been reached.
Nevertheless, Delhi regulators have repeatedly cited the ongoing money laundering investigation and related criminal proceedings as grounds for denying the company an L1 licence.
For Pernod Ricard, the issue has evolved beyond a legal dispute. It now directly affects the company’s ability to re-enter one of India’s most important urban alcohol markets.
Since 2023, the group has been unable to resume wholesale operations in Delhi, and the latest court ruling suggests that situation is unlikely to change anytime soon.
India Is Pernod Ricard’s Largest Market
By sales volume, India has become Pernod Ricard’s largest single market worldwide.
According to company documents cited by Reuters, Pernod Ricard’s Indian operations generated approximately US$2.86 billion in revenue during the financial year ending March 2025.
Its locally produced whisky brands, including Royal Stag and Blenders Pride, remain dominant in the country’s mainstream spirits market, while international labels such as Chivas Regal, The Glenlivet and Absolut continue to drive premiumisation.
Although Delhi accounts for only around 5% of Pernod Ricard’s sales in India, the capital has long been viewed by international drinks companies as a strategically important showcase market and distribution hub.
Since 2023, Pernod Ricard has been unable to restore its sales operations there.
According to court documents cited by Reuters, the company argues that the three-year licensing restriction has disrupted its supply chain and weakened its willingness to make further investments in the Indian market.
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