India might go out of scotch as govt bans imported goods at military canteens

New Delhi, Oct 24: The government has ordered its 4,000 defence canteens to stop buying imported goods.

The internal order issued by the Defence Ministry on October 19 said that in future, "procurement of direct imported items shall not be undertaken". Imports make up around 6-7 per cent of total sales value in these shops, according to the Manohar Parrikar Institute for Defence Studies and Analyses.

This move of the govt could ban the import from two foreign liquor firms such as Diageo and Pernod Ricard.

The order said the issue had been discussed with the army, air force, and navy in May and July and was aimed at supporting Prime Minister Narendra Modi's campaign to promote domestic goods. A defense ministry spokesman declined to comment.

India's defense canteens sell liquor, electronics, and other goods at discounted prices to soldiers, ex-servicemen, and their families. With annual sales of over $2 billion, they make up one of the largest retail chains in India.

The order did not specify which products would be targeted. However, industry sources said they believed imported liquor could be on the list.

Pernod and Diageo had briefly stopped receiving orders for their imported brands from such government stores in June. Diageo did not respond to a request for comment, while a Pernod spokesman declined to comment.

While imported liquor sales at defense stores generate only about $17 million in annual sales, the order would send a negative signal, said an executive whose company sells products at defense stores.