Not love for liquor but money, why states want alcohol to flow during coronavirus lockdown

Many states have gone on record to say that they want to lift the ban on the sale of liquor during the coronavirus lockdown. Some states have already done that. However, the new lockdown guidelines issued by the Centre on Wednesday have reiterated that there should be complete ban on the sale of liquor.

States may be constrained with the new advisory issued invoking the Disaster Management Act of 2005. This says that the district authorities have to ensure compliance. But the state governments are running out of money to sustain their fight against novel coronavirus, and alcohol sales are a good source state revenue - about 25 per cent of all.

Delhi Chief Minister Arvind Kerjwial last week directed all government departments to stop all expenses except salaries of employees. He said there is no revenue generation for the government due to coronavirus lockdown.

"Under the current status of revenue, the government will have to make major cuts in its expenses," Kejriwal said.

Kerala finance minister Thomas Isaac too stressed on the need for money while talking about the impact of the lockdown. He said, "Most states have limited the borrowing to Rs 500-1,000 crore [at interest rate of 9 per cent or so] and started cutting salaries or halting other developmental activities."

The lockdown has dried up GST collection for states and extremely strained their finances. The states were already dealing with a loss in revenue as the Centre was slow to compensate the GST shortfall.

There is another reason for states favouring sale of liquor during lockdown. There have been reports about the rise in the sale of illicit liquor from many parts across the country. In some other cases, the lockdown and the subsequent unavailability of alcohol has caused medical issues for some drinkers.

Addiction to alcohol is an added reason for the states to worry over during lockdown. At least in Kerala and Meghalaya, there have been reports that non-availability of liquor caused some to attempt suicide. Mental stress due to lack of alcohol is a recognised health condition the world over.

Going by consumption data, Kerala and Meghalaya have one of the highest per capita consumption of alcohol in India. On a national level, a report last year found a 38 per cent increase in liquor consumption by Indians over a seven-year period.

But don't be mistaken, the primary drive for states to let the shutters of liquor shops go up is revenue, not your or their love for booze. For example, Delhi -- a Union Territory with higher than national per capita income -- earns over Rs 5,000 crore from liquor sales every year. Karnataka earned Rs 21,400 crore last year from liquor sale.

So, states including Kerala, Uttar Pradesh, West Bengal, Assam and Meghalaya have allowed liquor shops to open partially. Delhi and Karnataka too were considering the same till Tuesday evening. Bengal is also considering home delivery of liquor following a Kerala example.

However, the new lockdown guidelines may just have complicated the matters. The notification bans sale of liquor invoking NDMA of 2005 but there is another law that the states have been focusing on. This is the Food Safety and Standards Act of 2006.

The food safety law defines alcoholic beverages as food. And, food is an essential item under all laws operating in the country. Both states and alcohol lovers hope that the Centre would the food safety law to prevail in the matter of liquor over the NDMA during lockdown.

There is a health concern with the complete ban on the sale of liquor. With reports suggesting liquor prices soaring in the grey-market, there is a possibility of proliferation of spurious liquor particularly in rural areas, which have been susceptible to such beverages in the past, and often hitting headlines for wrong reasons.

Note: The story has been updated. An earlier version mentioned the name of Goa among the states which have partially allowed sale of liquor. That information was based on reports by newspapers and news agencies. Responding to this story, Excise Commissioner of Goa Amit Satija said, "No liquor shop, bar, wholesaler etc. is allowed to operate in Goa since beginning of Lockdown as directed by government." This story has been accordingly modified.