Sumit Dhaman
Independent Alcobev Analyst
When we talk about the future of the alcohol industry, the discussion often begins with brands, pricing tiers or the difference between on-trade and off-trade sales. But there is another force quietly shaping tomorrow’s market, one that is far more fundamental. It is shifting demographics. Among global regions, India stands out not because its consumers drink the most today, but because millions are about to start drinking tomorrow, very soon.
The world’s alcoholic beverage market is at a turning point. Consumption patterns in many mature markets, especially Europe and parts of North America, are flat or even declining. Reports highlight a fall in average consumption, even as premiumisation continues among committed drinkers. Data from leading research firms shows that younger consumers in these regions are moderating intake, influenced by health priorities and lifestyle choices.
India’s Demographic Surge
India’s growth story is very different, which is why industry attention is focused here. According to United Nations population projections and IWSR insights, India is expected to add around 15 to 20 million new legal-drinking-age adults every year. Over the next five years alone, nearly 65 million young Indians will reach legal drinking age.
India’s growth story is very different, which is why industry attention is focused here. According to United Nations population projections and IWSR insights, India is expected to add around 15 to 20 million new legal-drinking-age adults every year. Over the next five years alone, nearly 65 million young Indians will reach legal drinking age.
The demographic change goes beyond numbers. It is closely tied to socio-economic realities. India’s median age is below 30, far younger than ageing populations in China, Europe or Japan. A fast-expanding middle class with rising disposable income is part of this picture. At the same time, social norms around alcohol consumption are shifting. Urban areas have seen growing acceptance of social drinking. Participation among women is increasing, and evolving attitudes among Gen Z and millennials are broadening the appeal of the category.
Trends and Market Dynamics
Recent stereotypes about Gen Z being a sober generation are being challenged by hard data. IWSR surveys across 15 global markets, including India, show that the share of Gen Z who reported drinking alcohol in the past six months rose from 66 per cent in 2023 to 73 per cent in 2025. In India, these trends show curiosity and involvement in drinking culture among younger people that is approaching the rates observed in older generations quite rapidly.
Within India, regional patterns add detail to the national picture. South India continues to be the largest consuming region by volume, accounting for nearly 60 per cent of IMFL (Indian-Made Foreign Liquor) sales, ahead of North, West and East. At the same time, evolving retail and hospitality sectors in cities and Tier II towns are lifting experiences beyond standard category definitions. Across states, varying legal ages and regulatory frameworks make the picture complex, but also highlight potential upside if harmonisation and ease of access improve.
Globally, the contrast is sharp. While overall alcoholic beverage volumes in top markets have seen modest contractions or stagnation, developing markets like India are outperforming averages in both volume and value, in spirits and beer. IWSR notes that in 2024 India contributed meaningful growth to global alcoholic beverage volume metrics, even as markets in the US, Europe and parts of Asia softened.
Emerging Preferences and Regulatory Challenges
The rise of ready-to-drink (RTD) products and the trend towards premiumisation indicate a generation that seeks experimentation evolving within social rituals. RTDs are forecast to grow significantly worldwide in the coming years, showing that convenience and lifestyle relevance are reshaping category dynamics. In India, local craft beers, flavoured spirits and low-ABV options are emerging as vibrant sub-segments, appealing to consumers who want variety without compromising quality.
The rise of ready-to-drink (RTD) products and the trend towards premiumisation indicate a generation that seeks experimentation evolving within social rituals. RTDs are forecast to grow significantly worldwide in the coming years, showing that convenience and lifestyle relevance are reshaping category dynamics. In India, local craft beers, flavoured spirits and low-ABV options are emerging as vibrant sub-segments, appealing to consumers who want variety without compromising quality.
Yet, recognising the opportunity does not mean ignoring the challenges. India’s market is still fragmented by regulation. Each state sets its own taxes, restrictions and retail structure, complicating distribution and pricing strategies. Even discussions about aligning legal drinking ages, such as recent proposals to lower Delhi’s beer age influence consumption patterns and long
term business planning.
The Eastward Shift
What the demographic wave makes one point clear. The world’s alcohol market is shifting eastward, in terms of place as well as mindset. For decades, growth was anchored in volume expansion in mature economies. Today, it is being driven by youthful populations, rising affluence and a broader definition of drinking occasions.
What the demographic wave makes one point clear. The world’s alcohol market is shifting eastward, in terms of place as well as mindset. For decades, growth was anchored in volume expansion in mature economies. Today, it is being driven by youthful populations, rising affluence and a broader definition of drinking occasions.
India’s alcohol story is still unfolding, and demographics are driving it. Each year brings a fresh group of legal-age consumers with different expectations around choice, quality and experience. This is not a short-term spike but a long arc of demand that will play out over decades. For brands, operators and category leaders, the task is to meet this generation in numbers as well as in its tastes, values and evolving lifestyles.
