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Delhi Wine Club

Posted: Thursday, 12 August 2010 11:06

Feature: Neo-Prohibition in Southern States

From the early 1950s the Government of India has periodically sought to persuade the State Governments to adopt a uniform prohibition policy. Attempt to impose prohibition in various states have periodically been made, but later that move was lifted as the budgetary deficit and the extra cost of enforcing prohibition made the effort financially non-viable writes Rajiv Seth reflecting on the recent statement by the Tamilnadu Chief Minister Mr. Karunanidhi that he may consider imposing prohibition.


The recent Fatwa or so it should be called, by Tamilnadu, one of India’s Southern State can be referred as Neo-prohibitionism which is the belief that the per capita consumption of alcoholic beverages should be reduced by legislation that further restricts its sale and consumption and also by changing social norms to reduce the acceptability of drinking.

Neo-prohibitionists tend to assume that:
*  The substance of alcohol is, in itself, the cause of drinking problems,
*  The availability of alcohol leads people to drink,
*  The amount of alcohol consumed determines the extent of drinking problems, and
*  alcohol education and policy should focus on the problems that excessive alcohol
consumption can cause and should promote abstinence.

These beliefs lead to the call for such measures as:

*  Increasing the taxes on alcohol beverages,
*  Limiting or reducing the number of sales outlets,
*  Limiting the alcohol content (proof) of drinks,
*  Prohibiting or censoring alcohol advertising,
*  Requiring warning messages with all alcohol advertisements,
*  Expanding the warning labels on all alcohol beverage containers,
*  Expanding the display of warning signs where alcohol is sold,
*  Limiting the days or hours during which alcohol beverages can be sold or served,
*  Increasing server liability for any problems that occur after alcohol consumption,
*  Decreasing the legal blood alcohol concentration (BAC) level for driving vehicles or
other activities, and
*  Eliminating the tax deductibility of alcohol beverages as a business expense.

It seems that most Indian states have used and implemented their alcohol policies to suit
their political objectives. Every time the state government changes, the state alcohol policy witnessed a shift for whatever reasons and subsequently justifying the political brass decision under the legacy of article 47 of Indian constitution.

Most people in India are completely unaware that an enormous and well-funded anti-alcohol lobby exists in our country. It consists of a large number of interrelated organizations, groups and individual activists who are opposed in some way to alcohol and its consumption, (one such organization is Indian Alcohol Policy Alliance based in  New Delhi, whose work is to do policy advocacy against harms related to alcohol use and is funded by Global Alcohol Policy Alliance-GAPA, UK and also receives support from FORUT a Norwegian NGO).

Some want to enforce Prohibition whereas most want to continuously pressurize the policy makers to increase the state taxes on alcohol to reduce its consumption. Thus policy makers consistently evolve policies to make alcohol difficult to obtain and difficult to market.

Reality of Prohibition in India

This article will address to some of the realities of prohibition in Indian states and will explore how Indian political brass have repeatedly failed in their attempts in implementing the complete or even partial Prohibition in a desirable manner and how these Neo-Prohibitionists have put tremendous pressure on state exchequers.

After the 1950’s, repeated failed attempts for Prohibition by many southern states, unilaterally led to the systems of "alcoholic beverage control" that put states in charge of decisions about liquor distribution. Some, like Karnataka exert an immense amount of control on what could be sold in their state, needless to say a policy formed to please a powerful liquor lobby whose main interest lies in the southern states.

The Three Tier System

States use a "three-tier" system of distribution, in which a winery or distillery must sell to a distributor, which must sell to a retailer, which then sells to customers. The wholesaler decides which wines or spirits brands are made available in their respective state and each state has just a few wholesalers operating there. Weirdness is the key on selection of Brands these distributers choose to sell with. It is no accident -- it's a legacy of a
well planned policy of protection for selected business houses.

What is most confusing is the manner in which the central and the state governments deal with the whole issue of alcohol. There are different positions of central and states governments at various levels. For example, whereas India's constitution declares, "the State shall endeavor to bring about prohibition of the consumption of intoxicating drinks." even then, successive governments have followed different policies on alcohol and currently the central government is encouraging deregulation of alcohol production and liberal imports of alcoholic beverages.

Confused Tamilnadu lacks cohesive policies

At the state level there is a consistent lack of cohesive policies; for example until recently Tamilnadu was propagating its newly formed Grape Processing Policy and was in the process of setting up Wine Parks suddenly changed its gear and started issuing statements of complete Prohibition by none other than their chief minister Karunanidhi. It is anyone’s guess if anybody will like to set up a winery project costing not less than 60 to70 million in such a confused state whose chief minister will first like to settle his political scores than settling for his own government’s policies.

The history of prohibition in the state of Tamilnadu will tell you that it was actually Mr. Karunanidhi who first abolished the prohibition in the state. After campaigning throughout the 1930s for the necessity to introduce Prohibition in India and urging that the Madras Presidency take the lead, C. Rajagopalachari was given the opportunity in July 1937 to put into practice what he had preached when the Congress swept into power in the Presidency and he was invited to become its Premier. Three months later, on October 1, 1937, the Prohibition Act he had introduced came into force, with district after district going dry.

It was a path-breaking legislation in Asia. But not long afterwards, following the outbreak of World War II, Rajaji's ministry resigned. Prohibition, however, continued to gradually expand its spread, so that by February 1948, Chief Minister, O.V. Ramasamy Reddiar was able to inform him that Prohibition had successfully been extended to the whole of Madras Province. The news made Rajaji, at that time Governor
of Bengal, ``feel a sense of achievement; completing the edifice of Prohibition in Madras was my dream''.

But the dream was to turn sour when in 1971, the Karunanidhi regime scrapped it. When his pleas ``on behalf of the people'' fell on deaf ears, an agitated Rajaji thought of legally challenging the decision. When it was pointed out that he didn't have much of a case, he pleaded with President V.V. Giri not to give his assent. And when the President merely replied, ``I have noted your views'', and endorsed the repeal, Rajaji was deeply depressed. That subsequent governments tightened up things a bit, made little difference to a State that had tasted liquor with comparative freedom for the first time in nearly 25 years.

Case of Gujarat

In July last year,136 people died in the Indian state of Gujarat after drinking tainted alcohol, and the incident has stirred debate over the state's alcohol prohibition policy, in existence since 1960. One of India's "liquor barons" has invited the state government to do away with prohibition, and the state government has invited him to shut up. And as Gujarat officials were quick to point out, moonshine deaths also occur in Indian states without alcohol prohibition.

In a statement Gujarat government spokesperson Jaynarayan Vyas noted that tainted alcohol had killed 31 people in Kerala in October 2000, 10 were killed and four blinded by bad hooch in Bhubaneswar in February of this year, 13 people died of bad booze in Kolkata in May 2008, and 142 people in Karnataka had died from illicit liquor over the course of last year.

Still, Vijay Mallya, chairman of the UB Group, India's largest liquor conglomerate, couldn't resist taking the opportunity to jab at the state's political leadership for its adherence to prohibitionist policies. Mallya offered to help the state a "responsible alcoholic beverages policy" in a statement cited in the Hindustan Times. "The deaths are not only tragic but should serve as a wake-up call to our political hypocrites. [Gujarat Chief Minister] Narendra Modi knows full well that every brand of alcohol is available in Gujarat," Mallya said. "The farce of prohibition, which cannot be enforced, leads to illegal, unhygienic and unsupervised production of deadly cocktails which claim innocent lives. It is time that political masters face reality in the interests of people's health," he added.

Effects of alcohol on state revenues

The potential loss in state revenue due to loss of excise revenue from the sale of alcohol
discouraged most state governments from enforcing prohibition on a long-term basis, as it accounts for almost 10 per cent of total state revenues, and in the case of Punjab it accounts for over one-third.

In 1964, the Centre offered to compensate the state governments 50 per cent of their loss in excise revenue caused by the implementation of prohibition. However, most states did not take up this proposal and removed prohibition. But Gujarat and Mizoram retained the law. In 1977, under Morarji Desai’s government a renewed hope for prohibition emerged. But nation-wide prohibition was not achieved.

Demands for prohibition slowly gave way to temperance as the negative effects of prohibition included wide-scale sale of spurious and cheap liquor which can cause health problems and deaths, the rise of organized crime and bootlegging due to the growth of a black market for alcohol. Apart from this, the resultant loss of jobs to people working in breweries and vineyards was another stumbling block.

The recent rhetoric from Mr. Karunanidhi saying he is contemplating enforcing prohibition in the State is for political expediency and needs to be looked at with the above background in mind.

Rajiv Seth

Rajiv Seth is a wine educationist, Author and an expert in International Wine Legislation especially European Union. In 1987, he became the first Indian to be awarded a gold medal from WSET, London. He also writes for DelWine. Contact him at



Subhash Arora Says:

Thanks Alok. Pity you didn't catch the note of sarcasm in it!! I do believe personally that it was an idiotic statement. But as I said in my edit, we are a free country and are allowed to say what we please and thank God for that!!.

Posted @ August 16, 2010 18:20


Alok Chandra Says:

Relax, no body in South India is going to enforce prohibition - this is just public posturing ahead of state assembly elections. The fact is, most state governments 9an politicians) derive a major part of their revenues from alcohol - and would go broke if they went the prohibition route.

Posted @ August 16, 2010 18:18


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