Ban of liquor sale has led to black marketing

The Centre’s nationwide ban on liquor sale has led to an exponential rise of black marketing of spirits. The blanket ban on sale of alcohol since March 25—when lockdown came into effect—has not led to a sharp decline in states’ revenues, while boosting its illegitimate sale at skyrocketing prices. Unfortunately, the additional money is of no use to the state coffers.

“A bottle of Ballantine’s scotch whisky, which is priced at around Rs 1,500 in Gurgaon, is now priced anywhere between Rs 2,100 and Rs 2,400, the demand is very high and people have been buying liquor,” a resident of Gurgaon, on condition of anonymity, told IN. Similarly, bottles of wine have been selling at almost one and half times the original price

The situation is no different in other cities. People said that liquor is being sold at exceptionally higher prices in Delhi and other parts of the country as well.

Sources said that most retailers who had leftover stocks were keen to deplete them and they found ready buyers, willing to pay higher prices.

Despite states showing keenness to open up sale of liquor, the Centre has not given its approval.

An analysis by IN earlier suggested that the sale of liquor should not opened up at the higher price which the consumers are willing to pay; the consumers can be asked to pay “corona cess”.

A State Bank of India report in 2017 revealed that prohibition has never worked in India.

As a political observer put it, prohibition has invariably led to black marketing. "As the number of coronavirus cases increases in India, one can understand that restaurants and pubs have been shut but there is no reason to close liquor," he noted.

At a time when states are staring at severe cash problems, the ban on sale has proved detrimental to their fiscal health while achieving nothing. Neither did people stop consumption nor did the money come to any official use.

According to the Confederation of Indian Alcoholic Beverage Companies, Indian Made Foreign Liquors or IMFL alone contribute Rs 1 lakh crore annually to government coffers. The state fiscal deficits too have become a cause for concern..