Dealing with the drink of India | HT Editorial – Editorials
On the first day of the third phase of the closure of India, where substantial relaxations were introduced, there was some chaos. And nothing symbolized this more clearly than the long lines, the rush, the shoving and the disputes in front of the liquor stores. It almost seemed like after 40 days, India was ready for the party. However, the violation of the norms of social distancing worried the governments considerably. In fact, it opens up the possibility of further spread of coronavirus disease (Covid-19) and wastes the gains made so far.
There have been a variety of responses to this chaos. But the sharpest came from the Delhi government. Prime Minister Arvind Kejriwal rightly issued a warning that if the violations continued, he would have to reintroduce restrictions. On Monday night, the government also imposed an additional 70% crown (virus) tax on liquor. Andhra Pradesh has raised liquor prices by 75%. One can intuitively think of this as a wise move. Governments aspire to meet two goals with higher prices. The first is to discourage people from waiting in line and buying alcohol, thus controlling crowds. The second, at a time when state public finances are under great pressure, is to increase additional revenue.
But, this is a mistake. First, there is a clear class bias in the decision because making alcohol expensive is unfair to the poor, while those with means will continue to buy alcohol legitimately. Second, it will not necessarily stop those who cannot afford legitimate drinking prices. The examples of states that have imposed the ban show that there is an immediate parallel economy emerging and a link between those who engage in illegal liquor and the flourishing of crime. Three, illicit liquor also has serious public health implications, and can lead to a sudden increase in deaths of women. And four, if the goal is income generation, the hikes must be reasonable and proportionate. Seventy percent is excessive. Indeed, governments must recognize rising demand and reform and liberalize alcohol sales. Allow more stores to participate in the liquor trade; allow online delivery, and increased volumes will lead to higher revenue. All of this, of course, must be done along with instituting stricter measures for social distancing in stores and holding liquor sellers and citizens accountable. Indian political leaders have had an awkward relationship with alcohol. However, the solution does not lie in more controls and prohibitions, but in a more liberal regime with regulation.