The Indian Liquor Industry Prohibition Story



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The Politics of Liquor

In 1996, in the north Indian state of Haryana, the Haryana Vikas Party (HVP) promised to make it illegal to buy, sell, consume or produce alcohol in the state if it were elected to the state assembly.1 The opposing parties criticized the HVP for trying to gain political mileage out of a sensitive issue like liquor prohibition. Despite the criticism, HVP won the elections and its leader Bansi Lal carried out the party's promise within minutes of becoming the Chief Minister (CM).

Over the next year, the ban cost the state treasury Rs 12 billion in excise revenue and led to a loss of 20,000 jobs in brewing, distilling and retailing of alcoholic drinks.In addition, 40,000 truckers, farmers and bottle producers experienced a substantial decrease in their earnings...

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TThe state police filed 98,699 cases involving about 100,000 people caught intoxicated or in possession of liquor.Over 13 lakh bottles were seized and 7,000 vehicles were impounded.The state also saw an alarming increase in deaths, resulting from the consumption of spurious liquor by poor people. To offset the loss of revenue, the government raised taxes and fees for various state-provided services - power tariff were increased by 10-50%, bus fares by 25%, and the petrol sales tax by 3%.

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