Every time we hear the term “alcohol” or “beer”, we often resonate it with addiction and health issues. However, it’s essential to acknowledge that in developing countries like Nepal, the beverage industry plays a pivotal role in economic development. This sector contributes significantly to employment generation, government revenue and tourism industry.
The alcohol industry is projected to become a billion dollar industry by 2025, including both in-home and out-home revenue. A report by World Travel And Tourism Council suggests that Nepal’s tourism sector generated Rs 327.9bn ($2.5bn) in revenue and supported 1.19m jobs directly and indirectly in 2022. In 2019, tourism contributed seven percent to Nepal’s GDP—much like the measured alcohol content that gives a beer its perfect kick. Even as pandemic sedated this vital sector, its upsurge now offers a unique opportunity to the alcohol industry to be able to cash in. Nepal can boost its economic flavor by intertwining beverage traditions with tourism.
The history of alcohol in Nepal has a close relation to its bioclimatic and ethnic diversity. For countless generations, several ethnic communities have been crafting and consuming fermented alcoholic beverages. Ethnicities such as Newar, Rai, Limbu, Tamang etc. consider alcohol an integral part of their tradition. People normally produce alcohol for local consumption and use it as a formal greeting during marriage and other occasions. Some households include a certain amount of alcohol into the fabric of daily life. In some communities, they are offered to guests and tourists that are prepared right in the household kitchen. A common form of drinks called “raksi”, “aila” and “jaand” are made from the distillation of millet,rice or wheat, and are typically consumed.
Apart from the cultural contribution, there are families, making a living through production of local-alcohols. Domestically produced alcohols are cheaper as they skip labelling and branding, nevertheless, in reality they hold immense potential in gaining a premium market if launched with proper strategies.
In Nepal, the regulation on alcoholic beverages comes under “Madira Ain”. This law sets limitations in local production of alcohol because of branding, labelling and quality concerns. A lack of coordination can be seen between these governments and these communities. Much like the ongoing debate on the legalization of Marijuana, the indigenous alcohol’s are perceived as harmful to health whilst their massive economic benefits are overlooked. The legal alcohol industry still seems illegal as the regulations are not fostering authentic and local production while the international brands are being imported in heavy amounts. Although effective commercialization channels may be lacking, the locally produced alcoholic beverages are being recognized on the global stage. In 2018, “Raksi” was ranked 41th among the world’s 50 most delicious drinks.
However, commercializing local alcohol brands in Nepal faces several challenges, especially with the dominance of well-established competitors. Despite the presence of many Nepali beer industries producing and exporting outside the country, the lack of global recognition makes it difficult to compete. The challenge is further intensified by distribution barriers and consumer trust. Due to the lack of consumer trust issues due to concerns about the quality of beverage and raw materials used, the local industries are unable to scale. Nevertheless, this can be reversed if the government comes together with the producers and incentivizes tourism-related alcohol production. Initially, making a strong capital investment is important, where visitors simultaneously experience the culture and the products. After this, aiming for global expansion can change the course of the alcohol industry in Nepal. As we make a global recognition, the beverages will export our culture and promote tourism for good.
Moreover, these drinks include higher content of alcohol making it tough for commercialization to tourists who are generally accustomed to milder options like beer.
If we want to uplift national revenue, prioritizing the local production over the import of fancy beers is important. “Beerification” of traditional alcoholic beverages such as: raksi, jaad and xyaang into internationally appealing products in Nepal can represent a transformative approach to rebranding our traditional alcohols. By rebranding these conventional drinks into premium beverages, our tourism industry will gain an edge over our neighbors. Visitors in Nepal seek experiences that celebrate our tradition and culture with authenticity. By presenting our unique, locally produced drinks, we celebrate our heritage while crafting unforgettable moments that enrich every traveler’s journey.
Upon navigating the data from across the world, the contribution of the alcohol industry to their respective economy is quite remarkable. For example, the Scotch Whisky Association reported that the whisky industry supported Scotland with around 40,000 jobs and generated over £5.4bn in exports where whisky tourism alone added roughly £68.3m in annual revenue. Similar is the case of Ireland and its reputed beer industry.
In the USA, the reintroduction of legal beer during the Great Depression revitalized the nearly decimated beer industry, spurring job creation and rejuvenating local economies. As argued by Professor Jason E Taylor in his book, “The Brew Deal”, allowing 3.2 percent beer to return played a crucial role in the economy during the nation’s darkest of times. Having said that, comparison of Nepal with politically stable countries might not be fair, but Nepal can always capitalize on the ever-expanding alcohol industry bolstered by its tourism potential.
Much like the ongoing debate on legalizing marijuana for its beneficiary production commercialization, the indigenous alcohol production in Nepal is suppressed and stakeholders are brushing aside its potential. The blend of the tourism industry with the flavor of local-alcohol can galvanize Nepal’s economy,especially in the post-pandemic era. Immense support from the government to promote “Aila”, “Jhaand” and “Raksi” is necessary, whereas, “Beerifying” the alcohol with the aim of diverse exposure and making subtle changes in marketing strategies can enhance our tourism industry as well as overall economy.
