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Wednesday, 12 April 2017 00:55
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Sarthak's edit

Prohibition will cause more problems for MP


With Madhya Pradesh chief minister talking of closing down liquor shops “in a phased manner”, the state is set to join the ranks of Kerala, Bihar and Tamil Nadu that imposed prohibition from 2014 onwards, after political leaders found it resonated strongly with women voters, particularly in lower-income groups where domestic violence was seen to be associated with alcoholism. In Kerala, while the Left Democratic Front that came to power in 2016—prohibition was introduced in 2014—has talked about revoking the ban, nothing has been done so far. Apart from the issue of what the ban will do the state’s finances as excise/VAT tariffs dry up—protagonists argue this is small change compared to the damage to people’s health and lives through liquor abuse—the more serious issue is whether prohibition works in anything but the very immediate short-term; indeed, even the Supreme Court will need to ponder over whether outlawing liquor sales 500 metres from highways will help curb drinking, and whether a person drinking 600 metres away is less of a problem.

While many believe prohibition encourages smuggling and creation of gangs that, over time, move to even more lucrative activities like smuggling arms, etc, there is the danger than people get hooked on to even more dangerous intoxicants. A news story in The Indian Express last week quoted medical officers in Bihar talking of de-addiction centres that, apart from treating cases relating to alcohol, were now reporting substance abuse ranging from cannabis, inhalants, sedatives and even opioids. In Kerala, between 2008 and 2013, the years before the alcohol ban, cases registered under the Narcotic Drugs and Psychotropic Substances Act—cases of drug abuse—averaged 718 annually (with a high of 974 in 2013). In 2014, when the state rolled out its alcohol ban under the previous government, cases registered under the NDPS Act shot up to 2,239. The 2015 and 2016 counts are 4,103 and 5,920. The Kerala ban has also caused bootlegging to rise—cases registered under the state Abkari Act that regulates taxation of manufacture or sale of alcohol have climbed from 48,828 in 2013 to 65,069 in 2016.The revenue implications aren’t insignificant either. In the case of Bihar, at Rs 3,217 crore, the excise collections from alcohol were nearly a sixth of Bihar’s own tax revenue in FY15; neighbouring Uttar Pradesh, though, would possibly have benefitted if liquor sold in the state is then smuggled into Bihar. In the case of Madhya Pradesh, the state raised over Rs 7,900 crore in excise duty collections in FY16 with another Rs 31 crore coming in as licence fees for selling foreign liquor and `5,760 crore coming in from auction of country and foreign liquor outlets. While that is probably why the state’s finance minister has tried to soft-pedal the move by saying a forced ban wouldn’t work, it is difficult to put the genie back in the bottle, especially after the CM has let it out.


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