The sale of liquor in Delhi was privatised a few months ago, from a mixed government and private model to a purely private version, which is all fine and welcome. Good governance probably does not have a role in the retailing of alcoholic beverages anymore. As long as taxes and paid and collected efficiently, and basic rules of the existing laws are maintained in context with age, quality, timing, safety and similar – nobody should really have a problem how a tippler gets to his or her tipple.
But that’s only one part of it. The other part is – how do the retailers afford these “BoGo” (Buy One Get One Free) offers or such heavy discounts?
The bigger change was in the way State taxes are now being collected. Instead of collecting per bottle or per litre or similar, the sellers now pay an annual licence fee for the specific role they are playing – wholesaler or retailer – and after that they pay only 1% + 1% as State taxes.
Think about it – the liquor is almost totally manufactured and bottled outside Delhi. The farm produce used to make this liquor is almost totally grown outside Delhi. Imported beverages are brought from abroad, either already bottled or bottled in India somewhere. In almost all cases, there is a physical movement of the finished product from somewhere outside Delhi, to Delhi.
So, hypothetically, once the Central Government dues are paid, the wholesalers can withdraw as much liquor from their bonded warehouses as they want at a 1% + 1% regime – destined for Delhi. Let’s assume the consignment arrives by sea at a Gujarat port, and then moves by road to Delhi, through a dry State and other States where local levies are much higher.
In a hugely cash business, do you get the drift on what is going to happen next, if you haven’t already figured out?
In the bargain, who suffers the most? Surprisingly, not so much the consumer, but more so the domestic alcoholic beverages manufacturer. And that, friends, is another column. But whilst in the rest of India, domestic Indian brands – especially in low alcohol content products – are going from strength to strength, here in Delhi we often don’t even see those brands.
What do we see instead? Plonk of doubtful provenance. Be aware that fake imported liquor is a huge problem globally – so our friendly neighbour across the Himalayas can churn out whatever brand you want to put on whichever bottle!
(Veeresh Malik was a seafarer. And a lot more besides. A decade in facial biometrics, which took him into the world of finance, gaming, preventive defence and money laundering before the subliminal mind management technology blew his brains out. His romance with the media endures since 1994, duly responded by Outlook, among others.)
