What The IMFL? The Origins Of "Indian-Made Foreign Liquor"
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The government, businesses, and media in India all use the term "Indian-made foreign liquor" (IMFL) to refer to all liquor produced in the country other than indigenous alcoholic beverages like feni, toddy, arrack, and others.

Spirits made in other countries that are brought in large quantities to India and bottled in an excise-bonded warehouse are also known as IMFL.

Whether you’re a seasoned connoisseur or a novice drinker, this guide will provide you with all the information you need to enjoy the best of India’s IMFLs.

History of IMFLs in India

Although Indian-made foreign liquors are often referred to by terms such as "Indian whisky" or "Indian brandy," these spirits do not actually qualify as whisky, brandy, or other types of liquor. This is because foreign liquors made in India are made from molasses, which is a byproduct of making sugar from sugarcane, instead of grains.

Types of IMFLs

The various types of IMFLs are expected to be locally manufactured using their traditional methods, such as fermenting grain mash to create whiskey. Still, many IMFLs are made with a neutral spirit made from molasses, which is a waste product of the sugar industry. This makes them different from spirits made elsewhere.

After being diluted with demineralized water from its original 96% ABV, this neutral spirit can then be flavored or blended with other spirits. At this point, caramel color is added to the bourbon to give it a rich amber hue. Whisky is typically blended with grain whisky or malt whisky, sometimes including imported Scotch or Irish whisky.

Two-thirds of the market is made up of whiskey, which grew 17%, while brandy, the second largest category, grew 37%. Excise data shows that sales of rum, vodka, and gin all went up. Rum sales went up by 41%, vodka sales by 55%, and gin sales by 129%.

While sales at bars and restaurants returned to pre-Covid levels in the most recent quarter, consumption at home increased during the pandemic. Because there are so many parties and celebrations around the holidays, alcohol sales tend to be high during this time. 

Indian whisky: There are two types of Indian whisky: Indian distilled (ID) whisky and Indian fermented (IF) whisky. Indian-distilled whisky is made using a combination of grains and molasses, while fermented whisky is made solely from molasses.

Indian brandy: The production of Indian brandy began in the early 20th century and is one of the most popular IMFLs. Unlike Western brandy, which is made from wine grapes, Indian brandy is distilled from a variety of fruits, including oranges, bananas, and pineapples.

Rum: The production of rum in India began in the early 19th century and is another widely produced IMFL. Indian rum is made from sugarcane, a crop that is widely cultivated in India.

Vodka: India has only been making vodka since the mid-1990s, which isn't that long ago.

Popular brands of Indian-made foreign liquors

The most widely produced Indian whisky is McDowell’s No. 1, a whisky that is widely available in most Asian countries. McDowell’s is a good representative of Indian whisky in general and makes for a great introduction to Indian whisky.

Bagpiper is another Indian whisky that is made in large quantities and is known for being cheap and easy to get.

Rum is produced across India and is associated with a variety of different brands. One particularly well-known rum is a brand called Old Monk, which is a very common brand of Indian rum.

Challenges for IMFL

Profitability has remained a stumbling block, however, as rising raw material costs have not been met by corresponding increases in liquor prices. Raw material costs have been on the rise, and at the same time, the government has been exerting a lot of control and regulation over the selling price.

As state governments often operate both retail and wholesale in various markets, alcoholic beverage companies must actively lobby for price hikes. For the most part, state-owned enterprises have been hesitant to pass on price increases to consumers, which has forced producers to absorb the entire increase in expenses and subsequently reduced their profit margins. Many businesses will have to weigh the pros and cons of continuing to bottle brands at prices that almost certainly will result in losses.

On the bright side, after a precipitous decline in FY21, the market rebounded strongly in FY22, increasing 13% to 353 million cases. More than 70% of the spirits market is dominated by IMFL brands like Royal Stag, McDowell's, and Blenders Pride. Let’s drink to that now, shall we?