Liquor to be cheaper in Punjab

Ruchika M Khanna

Tribune News Service

Chandigarh, March 13

The Congress government today announced the breaking of monopoly of big distillers-cum-contractors in Punjab’s booming liquor trade, besides reducing the quota of country-made liquor, Indian-made foreign liquor (IMFL) and beer to be sold in the state by 32 per cent.

As a result, the Capt Amarinder Singh government hopes to see a correction in the prices of liquor, which had increased substantially last year after the entire business was monopolised by the powerful liquor lobby.

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From the next fiscal, rural consumers will have to pay levy (@ Rs 5 per proof litre) on country-made and IMFL for upkeep of cows in urban areas and welfare of livestock in rural areas. Till now, the cow cess was levied only in urban areas.

To break the monopoly in liquor trade, the government has increased the number of groups (licensing units) from 84 this year to 900 in the coming fiscal. The size of the group has been fixed at a maximum of Rs 5 crore (excise collection in a year) with variation of up to 25 per cent. Each group will have a maximum of two liquor vends. 

However, the contractors can bid for and take in as many groups and as many places as they want during the auction.

This will translate into more contractors in the business, leading to competition and thus ensuring that prices of liquor cannot be manipulated. Nor can the contractors then exclude certain brands or types of liquor (based on alcohol content), Excise and Taxation Commissioner Vivek Pratap Singh told The Tribune. The Excise and Taxation Department had earlier proposed the number of licensing units at 1,400, with the size of the group pegged at Rs 3-4 crore.

However, the liquor lobby is learnt to have prevailed upon the powers-that-be, saying that such small groups would be financially unviable and would not be taken by contractors, especially in Patiala, Sangrur, Mansa, Bathinda, Fazilka and Amritsar. The policy was thus withheld last week and has now been announced with slightly larger group sizes.

Pointing out a loophole in the new policy, sources in the liquor trade said reducing the quota to be sold in the state under the minimum guaranteed quota (from 8.44 crore proof litre to 5.78 crore PL for country-made; from 3.71 crore PL to 2.48 crore PL for IMFL; and, from 3.22 crore bulk litre to 2.57 crore BL for beer) would result in an increase in liquor smuggling from neighbouring Haryana.

Gurtej Singh, Additional Excise and Taxation Commissioner, however, said enforcement would be strengthened and this would be a litmus test for the department to ensure that no liquor was smuggled in from the neighbouring states.