Pernod Ricard refutes putting on hold India investments over protracted tax disputes

INDIA – Pernod Ricard, which holds 17% of the volume market share in India, has refuted claims of it putting on hold investments in the country over long-running tax disputes with authorities on valuing liquor imports.

A Pernod Ricard spokesman said in a statement: “Pernod Ricard refutes having put new investments on hold in India, as claimed by local media this morning.”

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 “In the news, any reference to the discussions with local authorities that have been reported are out of context.”

It was initially speculated that the maker of Chivas Regal, The Glenlivet Scotch whisky and Absolut vodka is lobbying Indian authorities, to resolve the matter which has progressively worsened since it began in the 1990s.

According to a letter seen by Reuters, Pernod wrote to Prime Minister Narendra Modi’s office: “This ever-lasting litigation has been a big strain on our ease of doing business and has inhibited fresh investment by our group headquartered in Paris for expansion of business in India.”

“These tax disputes initially arose in 1994 in import valuation by the customs authority, have compounded year after year and are still ongoing.”

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Reuters adds that it received a statement from Pernod Ricard which said it has been in “continual dialogue” with Indian authorities as it looks at finding “a swift resolution to this long-standing matter”.

Pernod’s stance over the tax dispute casts a shadow on the future growth of the company in a region it says is among its “key strategic markets”.

It expects India and China, the world’s two most populous nations, to drive most of the alcohol industry’s growth in the next decade.

Pernod Ricard uses digital labelling to attract responsible drinking

Meanwhile, the French company best known for its anise-flavored pastis apéritifs Pernod Anise and Ricard Pastis has pioneered in spearheading a proactive initiative to inform consumers about responsible drinking.

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The initiative is under a digital labeling project aimed at offering consumers more transparency on ingredients and health information.

It is being rolled out as a European pilot program this July, followed by a global launch across all brands in Pernod Ricard’s portfolio by 2024.

The company said every bottle of Pernod’s brands will soon display its own QR code which contains several information about the drink.

Once scanned, it will direct consumers to an exclusive platform with information, including ingredients and nutrition; health risks; and responsible drinking guidelines.

The launch has come at a time when Pernod Ricard reported an increase in sales by 20% in the third quarter of fiscal 2022, boosted by double-digit growth across all regions.

The group also registered an organic net sales growth of 17% for the first half of fiscal 2022.

The company is relying on digital consumer awareness not only to further attract responsible drinking but also to help market its products more easily which will in turn push sales even more.

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