Drinking India: Alcohol sale a cash cow for some state governments (Video)

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Alcohol consumption is said to be widespread and rising in India, across all the states and union territories (UT). An estimated 160 million consume alcohol. Its use is at the discretion of individual states and union territories though.

Three major alcohol hot spots in the country were identified in a study: (1) Northeast states; (2) Eastern Peninsular states formed by Chhattisgarh, Odisha, Jharkhand, and Telangana; and (3) Southern states of Tamil Nadu and Kerala. More than 10% of their revenues come from taxes on liquor sales, reported BBC, citing the research wing of Crisil, a ratings and analytics firm.

Another six top consuming states – Punjab, Rajasthan, Uttar Pradesh, Madhya Pradesh, West Bengal and Maharashtra – mop up between less than five to 10% of their revenues from liquor.

“But not a drop was sold in April (2020), and given the dire state of their revenues, these states have been anxious to make good their losses by opening up the liquor vends,” the research agency said. Lack of liquor taxes has left near-bankrupt states groaning under the lockdown with little money to spend.

‘One who takes alcohol doesn’t lie’

According to the report, India consumes more whiskey than any other country in the world – about three times more than the US, which is the next biggest consumer. Nearly one in every two bottles of whiskey brought around the world is now sold in India. When worldwide booze consumption dipped in 2018, India partly drove a 7% uptick in the global whiskey market.

By volume, India has become one of the world’s largest consumer of all alcohol, the report says citing IWSR Drinks Market Analysis, a London-based research firm.

The south Asian country is the second largest consumer of spirits (whiskey, vodka, gin, rum, tequila, liqueurs), behind China. It consumes more than 663 million liters of alcohol, up 11% from 2017. Per-capita consumption is rising.

Indians, the report said, are drinking more than before. It cited a study of liquor consumption in 189 countries between 1990 and 2017 and found that consumption in India had grown by 38% – from 4.3 liters a year per adult to 5.9 liters.

Jakob Manthey of Technische Universitat Dresden in Germany and a lead author of the study, told BBC that consumption had gone up because the “number of people with sufficient income to purchase alcohol has outpaced the effects of measures aiming to reduce consumption”.

Enforcing prohibition over freedom of choice has proved to be self-defeating, it said, and led to a thriving black market. “Making drinking a moral issue raises the hackles of the liberals. But, as Pratap Bhanu Mehta, a leading analyst, says, if “we really care for freedom, we also need to question our own addiction to the cultural and political economy of alcohol, and find intelligent pathways around a complex problem”.

Yogendra Yadav, leader of the Swaraj India party and a political analyst, suggested that State governments reduce dependence on liquor revenues, stop aggressive promotion of booze, enforce existing rules and laws about sale and retail of liquor, and take the consent of 10% of local people before giving a retail license in a neighborhood, and using revenues from liquor sales to wean people away from drinking.