Payout to distilleries based on rising demand for alcohol: Govt | mumbai | Hindustan Times
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Payout to distilleries based on rising demand for alcohol: Govt

The state government has told the Bombay High Court that its alcohol-from-foodgrains policy has been based on a surge in demand for potable alcohol and for alcohol put to industrial use.

mumbai Updated: Feb 26, 2010 02:04 IST
HT Correspondent

The state government has told the Bombay High Court that its alcohol-from-foodgrains policy has been based on a surge in demand for potable alcohol and for alcohol put to industrial use.

The court had, in early January, stayed disbursal of Rs 1,000 crore of taxpayers’ money — in the form of subsidy — to distilleries that make alcohol using foodgrains. The subsidy is applicable to 21 distilleries, many of them controlled by politicians.

The court had said the restraint would be in place until the state filed an affidavit at the next hearing.

The state filed its affidavit a few days ago, which means the restraint order is no longer in place.

The Bhimshakti Vichar Manch, an Aurangabad-based organisation, has filed a public interest litigation saying crores are being given to distilleries when children are dying of malnutrition.

The state claimed in its affidavit that its decision would not add to shortage of foodgrains as only low-quality jowar would be used for making alcohol.

The move would in fact provide support to farmers from rain-fed areas and foster development in the rural areas of Marathwada and Vidarbha, the state said.

The affidavit stated that the demand for alcohol, both potable and for industrial use, had shot up by 80 per cent since 2006-7.

The state said it has so far granted letters of intent to only 21 distilleries, of which 7 have become functional recently.

Even if all 21 distilleries work at their highest capacity, they would consume 8.5 lakh tonnes of jowar, while the state’s total production of jowar today stood at 34 lakh tonnes.