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Cash-strapped Shivraj Govt Hits Roadblock with Excise Policy as Uma Bharti Announces Liquor Ban Drive

By: Vivek Trivedi


Last Updated: February 14, 2021, 17:39 IST


File photo of Madhya Pradesh CM Shivraj Singh Chouhan.

File photo of Madhya Pradesh CM Shivraj Singh Chouhan.

In a bid to rake up revenue, and counter the sale of spurious liquor, the MP government was planning to sell alcohol online and hike the numbers of liquor vends.

The cash-starved Shivraj Singh Chouhan’s government in Madhya Pradesh has hit a fresh roadblock with its proposed excide policy with several within the Bharatiya Janata Party (BJP) in the state opposing the move.

In a bid to rake up revenue, the government was planning to sell alcohol online and hike the numbers of liquor vends. The move was also meant to counter the menace of sale of spurious liquor, a major challenge for the authorities, especially after the coronavirus-induced lockdown.

Former chief minister Uma Bharti, a known detractor of Chouhan, recently announced she would launch a campaign to ban liquor in the state. While appreciating the government’s proposal to open fresh liquor vends, Bharti, who is sulking for being sidelined in the party, said she would begin her campaign on International Women’s Day — March 8.

“Revenue loss due to liquor ban could be made up through other sources, but liquor-led incidents like rape, murder and accidents are a blot on Indian society,” said Bharti.

“No one died due to unavailability of liquor and this was evident during the lockdown,” the BJP leader added.
Soon after, Chouhan postponed implementation of the news policy and allocation of contracts till July 2021.

“We also support a campaign to ban liquor and make MP alcohol-free,” Chouhan recently said in a public meeting.
In the same breath, he, however, added that if there are consumers, liquor will continue to be supplied.

The Congress has also openly supported Bharti’s proposed campaign. “We support Uma Bharti seeking a ban on liquor in Madhya Pradesh,” said former Congress minister PC Sharma. However, the policy was originally mooted during the previous Congress government, led by Kamal Nath.

Analysts, however, said the BJP government’s flip flop on the excise policy was due to the upcoming civic body polls as the move could have a negative impact on the party’s performance. The elections are expected to get over by early July.

Meanwhile, the excise department had completed preparations for auction of liquor shops which normally is done by March 15, so that fresh contractors can start functioning by April 1.

The state government also plans to form small groups for handing liquor contracts so that there is no carterlisation and prices remain in check. During the former Congress dispensation, led by Kamal Nath, the contracts were given to two-three major groups which helped them control supplies and ensure that prices do not slump.

Over 50 people have lost their lives over the past 10 months due to consumption of spurious liquor in the state.
Excise Sector Revenue

A landlocked state, Madhya Pradesh relies heavily on excise proceeds for revenue, besides levies on petrol and diesel. In 2019-20, the government had accumulated Rs 8,321 crore from the excise department and it estimated to rise to Rs 10,318 in FY 2020-21.

Number of Liquor Vends

There were 2,221 liquor shops in the state in 2003-04. It rose to 2,770 in 2010-11. By the financial year 2020-21, there are 2,544 shops of Indian Made Foreign Liquor while there are 1,061 desi alcohol shops. Earlier, Home Minister Narottam Mishra had said the state was mulling increase in liquor vends, including those in far-flung areas to fight off the menace of spurious liquor. His statement came soon after 24 people died over the issue in Guna.

Guna Hooch Tragedy

The hooch tragedy in Guna in early January had brought to fore again the menace liquor mafia in Madhya Pradesh. Such activities has surged primarily during the lockdown when liquor shops remained shut. The situation worsened when supplies were restored, but there was a steep price hike.

Besides 24 people, four others had died later fpr having consumed spurious liquor in Guna. Investigation found the massive rise in alcohol prices had led to illegal supply of cheap local booze.

Crackdown Unearths Scary Picture

Following a widespread crackdown on liquor mafia, it was found that illegally produced liquor was available freely in several districts, including Bhopal, Indore, Gwalior, Bhind, Morena, Mandsaur, Ujjain and Jabalpur. A glass of desi liquor was easily available in several far-flung areas for as low as Rs 10. Many of these districts like Ujjain had an organised nexus of manufacturers of illegal intoxicants.

Govt-Liquor Traders’ Faceoff

There was a major tussle between the BJP government and liquor traders last year when the administration declined to offer relaxations to sellers who had protested against the closure of shops due to the lockdown. Traders, under the banner of MP Liquor Distributors Association, had moved the Supreme Court against the state government stand and the latter had submitted an affidavit stating that it will allow traders to run shops for extra two months in FY 2021-22.

Amid Excise Revenue Shortfall, Fuel Prices Rise, Petrol Hits a Ton

The cash-strapped government in the state has now steeply increased prices of fuel. With around 39% VAT, MP is levying the highest tax on petrol and diesel prices. In the aftermath of COVID-19 pandemic, as global crude prices surged, fuel rates in Madhya Pradesh saw an unprecedented rise. On February 13, unbranded petrol sold at Rs 96.37 a litre while the premium variety was selling at Rs 100.04 a litre. This is perhaps first time, the petrol has crossed Rs 100 a litre mark in state capital Bhopal. Diesel was sold at Rs 86.46 per litre.

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first published:February 14, 2021, 17:38 IST
last updated:February 14, 2021, 17:39 IST