Rolling back new liquor policy in Delhi, reverting to old regime where govt dominates sale of liquor, is a bad idea

The story seemed to turn sour, however, when the Economic Offences Wing of Delhi Police started investigating allegations of irregularities and corruption in the disbursal of liquor licenses. It was alleged that the Delhi government gave out “illegal” licences to companies that violated the terms and conditions of the excise policy. Manish Sisodia, the minister in charge, was accused of implementing this policy without the approval of the Lieutenant Governor of Delhi, and providing waivers and undue benefits to new licensees. The Delhi government, it was alleged, had revised the rates of foreign liquor (making them cheaper) and removed the levy of import pass fee of 50 per case of beer, and such decisions, it was said, resulted in a loss of revenue to the state exchequer. As the investigations began, the Delhi government, in an unwise and knee-jerk reaction, overturned its policy and rolled back to the old regime where the government used to dominate the sale of liquor.

This has not just inconvenienced customers but also left the private vendors high and dry. There are, at present, 468 private vendors in Delhi — each employing an array of workers such as salesmen, sanitation staff, security guards and managers. A summary policy reversal means all of them will lose their jobs for no fault of their own. Those who are lucky enough to migrate to a government outlet will likely see a sharp mark down in their salaries. This is apart from the loss to entrepreneurs who spent upwards of Rs 250 crore to acquire the licence of a zonal vendor, which does not include the nearly Rs 25 crore that it could take to set up the actual shop. This raises two questions: Who pays for these losses? Why would anyone invest in a state where government policy can change overnight? These are important questions that the government can ill afford to ignore.