Jagan’s policy of phased liquor prohibition goes for toss, prices drop to prevent smuggling

Updated on Oct 30, 2020 08:20 PM IST

As part of the new excise policy, the Andhra government took over the liquor trade from private parties to prevent mushrooming of unauthorised liquor outlets in villages.

Andhra Pradesh chief minister S Jagan Mohan Reddy.(PTI)
Andhra Pradesh chief minister S Jagan Mohan Reddy.(PTI)
Hindustan Times, Hyderabad | BySrinivasa Rao Apparasu | Edited by Sparshita Saxena

The ambitious plan of chief minister YS Jagan Mohan Reddy-led government in Andhra Pradesh to implement liquor prohibition in a phased manner, leading to total prohibition by 2024, has failed to yield desired results, officials said.

As part of the new excise policy that came into effect from October 2019, the Andhra government took over the liquor trade from private parties to prevent mushrooming of unauthorised liquor outlets in villages.

The government also reduced the number of retail outlets by 33 percent – from 4,380 to 2,934 and bars by 40 percent – from 840 to 530, to reduce access to the availability of liquor. The business hours of wine shops were also reduced by two hours.

Besides this, the government also ordered that a person could not have more than three liquor bottles without a licence in possession. It increased the liquor prices substantially in October 2019 and further by another 75 percent amid the Covid-19 pandemic to further discourage consumption of liquor in the state.

However, these measures were not able to bring down liquor consumption in the state substantially. In a government order issued on Thursday evening, special chief secretary (revenue-excise) Rajat Bhargava admitted that there has been an increase in the incidence of smuggling of liquor into the state of Andhra Pradesh from May 2020 onwards.

“The most important reason for this increase in inter-state smuggling is increased prices of liquor in Andhra Pradesh due to an upward revision of rates when compared to the prevailing prices of liquor in the neighbouring states, especially in Telangana and Karnataka,” he said.

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Bhargava said, apart from an increase in the smuggling of liquor into Andhra, there had been unfortunate incidents of people dying due to consumption of sanitisers and methyl alcoholic preparations in the post-lockdown period.

As a result, in September, the Jagan government was forced to reduce the prices of some liquor brands, beer and other ready-to-drink beverages like toddy to prevent inter-state smuggling of liquor into the state and deaths caused by consumption of sanitisers.

At the same time, it moderately increased the prices of medium and premium segments of liquor. But this did not stop tipplers from bringing in liquor from neighbouring states for consumption.

“Between September 15 to October 15 this year, there were 1,211 cases of liquor smuggling including 630 cases from Telangana, 546 from Karnataka, 24 from Odisha and 11 from Tamil Nadu,” Bhargava said.

According to the official statistics, 48,182 cases have been registered and 59,438 people were arrested for illegal transportation of liquor into the state in the last six months.

The government also realised that the clause that a person can possess a maximum of three liquor bottles without any permit also resulted in large scale smuggling of premium brand liquor from neighbouring states. So, early October, the government removed this clause saying nobody can bring any liquor brands from outside the state without paying excise duty.

The Special Enforcement Bureau (SEB), constituted by the government to curb liquor smuggling into the state, reported to the government that most of the smuggled liquor brands were of medium and premium segments whose prices in the state were more than double the MRPs prevailing in Telangana and Karnataka.

Based on the SEB report, the government issued an order reducing the prices of medium and premium brands of Indian Made Foreign Liquor and other imported liquor brands with effect from Friday.

“The reduction ranges from Rs 50 per 180 ml of certain brands to Rs 1,350 per bottle for high premium IMFL brands,” the government order said.

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