ABSTRACT
The paper looks at the interactive relation of the prohibition act with market and stakeholders. The findings are based on interaction with different stakeholders and uses a qualitative research approach.
LIQUOR PROHIBITION
ACT: THE CASE OF
GUJARAT
Focus on Public Policy & Marketing
Rahul|Edwick|Vishnu
IRMA PRM 35
About the Authors
Edwick P. Bilung
P35027
PRM 35
Institute or Rural Management, Anand.
Contact: p35027@irma.ac.in
Rahul Singh
P35170
PRM 35
Institute or Rural Management, Anand.
Contact: p35170@irma.ac.in
Vishnu Vijayan
P35106
PRM 35
Institute or Rural Management, Anand.
Contact: p35106@irma.ac.in
Table of Contents
Introduction ...................................................................................................................... 4
The Prohibition Act .................................................................................................................... 5
Background ................................................................................................................................ 6
Objective & Scope ............................................................................................................ 7
Objective of the study ............................................................................................................... 7
Scope of the study ..................................................................................................................... 7
Methodology .................................................................................................................... 8
Structure ................................................................................................................................... 8
Sample and Sampling ............................................................................................................... 8
Sources of Data Collection ........................................................................................................ 8
Tools .......................................................................................................................................... 8
Findings ........................................................................................................................... 9
.
Stakeholders .............................................................................................................................. 9
Consumers ..................................................................................................................................... 9
Sellers ............................................................................................................................................ 9
Law Enforcing Authorities .......................................................................................................... 10
General Public ............................................................................................................................. 10
Informal Channel of Distribution ........................................................................................... 10
Affect on Stakeholders ............................................................................................................ 12
Consumers: .................................................................................................................................. 12
Sellers .......................................................................................................................................... 12
Law Enforcing Authorities ........................................................................................................... 13
.
General Public ............................................................................................................................. 13
.
Pressure of Market ................................................................................................................... 13
Conclusion ...................................................................................................................... 15
.
Case 1: The Bootlegger who is Tech Savvy ....................................................................... 16
Case 2: Alcohol just a call away. ...................................................................................... 16
Annexure 1 ..................................................................................................................... 17
Alcohol Bottle with the label “For sale in Punjab only” ............................................................. 17
Annexure 2 ...................................................................................................................... 18
Beer Canto be sold in Dadra and Nagar Haveli. ......................................................................... 18
Introduction
India being a vast subcontinent with diverse culture, the alcoholism and drinking habits differ from state to state. Hence it is difficult to classify the drinking culture in India as a single unified one. As per the statistics, Kerala emerges as the state with most alcohol consumption per capita. Kerala has a per capita consumption of 8 litres, which is four times that of Rest of India. Kerala is followed by Punjab and Haryana in terms of alcohol consumption per capita. The alcohol consumption for certain states are deeply inculcated in the culture and has been passed on as a part of tradition through the years. Although, as a contrast there are few states that has hardly any drinking culture. In recent years there has been a noticeable rise in the consumption of alcohol in urban areas especially among the youngsters. But it is the poor and people living in rural areas who are the major consumers of alcohol. As per the statistics 5% of alcohol consumers comprises of female in all over India.
Alcoholism has been identified as a major reason for the domestic violence, especially in the rural households. Also alcoholism results in increased crime rates as few studies reveal.
Hence through the years many states have put forward efforts to control the consumtion pattern of alcohol. Currently in India, there is a ban imposed in the state of Nagaland,
Lakshadweep, Gujarat, parts of Manipur and union territory of Lakshadweep. Further Bihar was the latest to follow this path by imposing ban from April 5, 2016. In this paper we will be critically analysing the impact of imposing such alcohol ban in the state of Gujarat, how it is being implemented and the effectiveness of the policy and also come up with recommendations for policy changes.
India has witnessed an immense increase in the alcohol consumption through the years. Between 1970-1995 there has been a 106.7% increase in the per capita consumption of alcohol. Further during 1992-2012 there was a further increase by 55%. India has gathered a lot of attention from the international brewers and distillers as it is the third largest market in terms of alcohol consumption globally. Also India is the largest producer of alcoholic beverages in South East Asia. Indians prefer hard liquor and distilled spirits over beer. Also most of the people in India follow a type of drinking called binge drinking, where a person deliberately becomes intoxicated. It is one of the most dangerous pattern of drinking, where a person consumes excessive amounts of alcohol in a short time period. Which further results in negative consequences like:
•
Alcohol poisoning
•
Alcoholic liver diseases
•
Trigger symptoms of depression
•
Lead to alcoholism
•
Lead to violence and blackouts
Also there is a growing concern of underage drinking becoming a problem in India.
The age limit for consumption of alcohol may vary from 18-27 years, which differ from state to state. Although it is common for Indians to consume alcohol before reaching the legal age.
The Prohibition Act
The Bombay state had prohibition of alcohol between 1948 and 1950 and again from
1958. It prohibited manufacture, storage, sale and consumption of alcoholic beverages in the state of Gujarat. Further when the Bombay state was bifurcated into Gujarat and Maharashtra state in 1960, the act was enforced in both states. Maharashtra issues license for distribution and sales of alcoholic beverages, but the law is still in effect in Gujarat. It is famously known as Bombay Prohibition Act, 1949. Many amendments were done on this act, the latest being done on 2009 as a mark of 60th year of Republic India. As per this amendment, the act will be called “the Bombay Prohibition (Gujarat Amendment) Act, 2009. The latest amendment states that:
1. Notwithstanding anything contained in the act, whoevera. Manufactures laththa
b. Constructs or works any distillery or brewery for it
c. Sells or buys laththa
d. Uses, keeps, transports or has in his possession laththa
Shall on conviction be punished with imprisonment for a term which may extend to
10 years. But shall not be less than 7 years and also with fine.
2. When there has been death of any person by the consumption of laththa, the person who manufactured, kept, sold or arranged it drink or distributed shall on conviction be punished with death or imprisonment for life and also be liable to fine.
3. Whoever keeps, sells, buys or supplies any material for the manufacture of laththa and when there has been death of a person by the consumption of said laththa shall,
on conviction be punished for a term of upto imprisonment for life and shall also with fine.
“Laththa” means spurious liquor, which contains methanol or any other poisonous substance.
Which may cause harmful injurious effect to the human body. This amendments was done in light of the Hooch tragedy that took away the lives of 136 people.
Background
The ban on alcohol was introduced as a homage to the father of the nation Mohandas
Karamchand Gandhi after his demise. The fact that it came into force during the demise of
Mahatma Gandhi had further made it a sensitive issue. Mahatma Gandhi was against the consumption of alcohol and had a harsh view regarding the same. In 1927 he said ““I would rather have India reduced to a state of pauperism than have thousands of drunkards in our midst. I would rather have India without education if that is the price to be paid for making it dry.” He urged the dalits to give up the “serious defect” of consumption of liquor. Further he was quoted of saying “Many of them [manual scavengers] are given to the evil habit of drink.
Drink is a bad, filthy, unclean, degrading habit. A man who drinks intoxicating liquor forgets the distinction between wife, mother and sister. I would beseech you to give up all evil habits, and you will at once find that you are accepted as honourable members of society without any stain on you.”
Due to this it became a large part of Congress’s ideology and had involved in the picketing liquor shops during the 1921 non cooperation movement. Hence when congress came into power in 1939, it had adopted the introduction of alcohol prohibition. However it was rolled back by the British after the congress resigned from the office to protest India’s inclusion in World War 2. After the Independence in 1947, in 1949 Chief Minister of
Bombay state Morarji Desai brought in the Bombay Prohibition Act. Further in 1954, Prime
Minister Jawaharlal Nehru appointed the Prohibition Enquiry Committee that was to design a plan to extend prohibition all over the country by 1958. Although he was not successful in bringing a national ban.
Objective & Scope
Objective of the study
The study is done for the course Public Policy and Marketing at Institute of Rural
Management, Anand. The broad objective of doing this study are:
•
Apply classroom learning and recognise how marketing affects the welfare of the society in the context of dry state and informal liquor market.
•
Understand the societal pressure on marketing in the given context
•
Evaluate impact of policy on the market and the well being of society.
Scope of the study
The study gives an insight into the implications of banning alcohol and its consequences.
This study can be used to develop critical thinking in the mentioned area and if possible work changes in policies that address the problems.
Methodology
Structure
The study is a qualitative research based on field research conducted around Gujarat.
The study began with understanding the primary stakeholders, identifying them and then finally interactions were made to get insights.
Sample and Sampling
Snowball sampling and ease of finding contacts (stakeholders involved) was the rationale behind choosing the following districts in Gujarat
•
Anand
•
Ahmedabad
•
The Dangs
•
Vadodara
Sources of Data Collection
Interactions were made with alcohol consumers, alcohol sellers, law enforcing authorities and common public.
Tools
Semi-structured interviews were taken of the the sources mentioned above.
Findings
Stakeholders
The stakeholders are as explained below.
Consumers
Though Gujarat being a dry state it is quite surprising to come across a large number of people who consume alcohol in the state. There are prone alcoholics, occasional or social drinkers, young working people who either belong to the state of Gujarat or are from outside states, college and university going youngsters, workers and labourers and many people from different backgrounds and social stature. Consumers as many assume are youngsters or people between the ages of 20-35 but what’s interesting is that many of the consumers are elderly people who are consume alcohol on a daily place.
“It’s just a ban on the surface, a parallel informal market runs in Gujarat which serves alcohol to people who want it.”
-A Bootlegger in Ahmedabad who is an auto rickshaw driver.
Sellers
People mainly living in the slums or people from lower income group are involved in bootlegging. Bootleggers are approachable through rickshaw drivers and also operate through phones. Bootleggers will deliver to the doorstep on just a call at any point in the day or night. Bootleggers are just the part of the nexus as many of these bootleggers work for other individuals who are powerful and are running this business from many years.
Bootleggers are the face of this system and the real owners or “boss” are people who have strong political connections and huge capital power.
“Sir! You just tell me the brand and the quantity. Rest will be taken care of”
-A Bootlegger in Anand
When asked about the availability of brands.
Law Enforcing Authorities
A very important part of this nexus are the law enforcing authorities like constables, police officers and other high personnel in the department. Such a big alcohol business can only run with the involvement of the police as these authorities get their “haftas” and “cuts” time to time. Police officers even take bribes from consumers who are caught which could range from mere hundreds to thousands of rupees.
“We also don’t like involving ourselves in these pity offences. We act when we get orders from higher authority otherwise we have a lenient attitude towards alcohol.” -A Police Officer from Anand.
General Public
This constitutes the people of the state who do not consume alcohol and are not in any ways related to this system.
“Gujarat is a dry state but still you can manage alcohol. Since it is dry state, you’d find no drunkard on the street but in the privacy of their rooms.”
-A Lady living in Anand.
Informal Channel of Distribution
Alcohol is available in almost every part of Gujarat and such wide availability is a result of a very efficient underground or informal channel of distribution. Alcohol enters
Gujarat from all the neighbouring states such as Daman, Silvassa, Maharashtra, Madhya
Pradesh, etc. As we step out of Gujarat to these neighbouring states we find n number of liquor shops on the border. These liquor shops smuggle alcohol into Gujarat through different ways. One of a well renowned lawyer of Anand quoted “everyday 80 trucks of liquor enter
Gujarat and what you think how is it possible without the involvement of the police”. These smugglers come up with creative and innovative ways of smuggling alcohol inside the state.
Smuggling has also attracted people from the upper class and middle class of the society as they also help in smuggling alcohol in their cars and private vehicles. It is a lucrative job as with high risks comes high remuneration. Most of the alcohol that enters is produced in
Daman, Silvassa, Haryana and Punjab as one could see labels like “ONLY FOR SALE IN
HARYANA” on the bottles.
“Everyday 80 trucks of liquor enters Gujarat…”
-A prominent lawyer from Anand .
After entering in the state these trucks and carriers travel to different parts of Gujarat delivering their consignment to specific dealers or “parties” as referred by the locals. These dealers further distribute alcohols to different local bootleggers who stock it and provide it to their consumers. Bootleggers have established a strong connection as they could be easily found if one asks the rickshaw driver in the area. Bootleggers also give their contact numbers to the regular customer so that can order it on call and it can be delivered to them.
“Maharashtra border is 5 minutes away from Saputara. Why do you think people come to Saputara? They don’t come for the place but the beer shop.” -A restaurant owner in Saputara (The Dangs).
Bootleggers have also started using technology as they would message or whatsapp the day’s alcohol menu i.e. what all type and brand of alcohol is available for the day with their rates every morning to their regular customers.
Other than bootlegging there are also places in the outskirts of the cities in villages between the fields or secluded places where alcohol is sold openly. They are referred to as “thekas” or
“stands” by the local people. The environment of these thekas is pretty surprising as the alcohol is sold openly like in any other liquor shops and they have facilities to keep beers chilled. These places also have people serving snacks also known as “Chaknas” and sitting
space where people sit and drink. There are entertainment facilities to keep people consumed like television, music systems and also you will find ladies how are offering gambling facilities. Alcohol prices fluctuates according to the holidays, festive seasons and availability.
A bottle of brand XYZ whiskey can cost from ₹ 600 on normal days to ₹ 1200 during festive season. Bootleggers even adulterate the alcohol with local spirits or country liquor so as to increase their income or just to get their daily fix of intoxication. These can have some serious implications as a bad poisonous liquor can be consumed by people. As we have the case of 2011 when around 67 people died of consuming adulterated alcohol in Ahmedabad.
Affect on Stakeholders
Consumers:
As Gujarat is a dry state drinking alcohol comes at an expense of one’s comfort and freedom. Consumers mostly drink behind closed doors; at home or in hiding or in cars as getting caught can put them into trouble. People who belong to other states and are now settled here find this whole setup very unpleasant as they are not familiar to such scenarios and as many quote “Drinking alcohol is not a pleasure anymore and all the fun is gone away as we have to be careful all time”. When any of these consumers are caught by the authorities they have to bribe them and if they cannot they have to go through a long legal procedure where they are treated as criminals and are insulted by the cops and media though they are fined a small amount of ₹ 200 – ₹ 500 only. This is a traumatic experience for few who get scared and get mentally and emotionally disturbed by the ruthless procedure.
Consumers also face the risk of consuming adulterated alcohol as the bootleggers mix local spirits into the branded bottles. As alcohol is banned there are no system or process there to check whether the alcohol is pure and not adulterated, this gives suppliers an opportunity to carry out this mal practices for increasing their earnings. Adulterated alcohol can cause serious health implications and can even prove fatal.
Sellers
The market is favourable for the bootleggers to flourish as they control the market and can earn a handsome living out of it. The ban has given rise to one of the biggest black
marketing of alcohol in India as alcohol is sold extensively in every part of the state. The bootleggers control the supply and also control the pricing which earns them higher margin during festive seasons. A bottle of brand XX whiskey costing ₹ 380 (MRP) (Annexure 1) is sold at ₹ 600 and at ₹ 800 during festive seasons and at lean periods. In most of the cases it was observed that bootlegging served as a secondary income source.
“I own this auto and whenever tourists ask for alcohol I sell them or take them to the place. “
-An auto driver in Ahmedabad .
Sporadic raids conducted by police costs the business as they have to pay huge bribes and sometimes they are put behind bars though they are bailed out or released pretty quickly.
Law Enforcing Authorities
The law enforcing authorities are pretty lenient towards alcohol consumers as they find it too much of a hassle for a petty crime until they have orders from higher authorities.
They mostly let the customer go after taking bribes which can differ according to the situation and the paying capacity of the customer. Police authorities even get a cut from the bootleggers as haftas. This way even police personnel’s earn an extra income. Through our observation we discovered that police officials also play a part in the pricing of the alcohol as they maintain a parity in the rates in that area.
General Public
The general public experiences regular part noise. This is experienced in the areas surrounding these institutions and hostel areas in Vidyanagar.
Pressure of Market
In our study what we observed is that there is a pressure of the market. There is a high demand of alcohol in the market and there are sellers who are satisfying these demands. This has also promoted cross selling as sale of many complementary products gets affected like the sale of complementary snacks, aerated drinks, cigarettes, etc. The market shows that there
is huge potential for the state to increase its revenue which under The Prohibition Act profiting the black market.
Conclusion The Gujarat model of prohibition is a blanket to reality. A parallel market of alcohol, informal in nature, exists. This market addresses the need of people who drink alcohol and also creates benefits for the law keepers to go rogue.
Marketing of alcohol in dry state has its own consequences. Chances of adulteration are common and health risks are there. Hooch tragedy is always in the making. Also, the ambiguous stand of the state in this matter makes it tough for the law keepers to act. This ambiguity has created a void which is used for personal gains by some policemen.
A pressure by alcohol consumers and lenient attitude of law enforcers has created a pressure on the market and bootleggers are making gains out of this. The market forces are clearly dominant in the case. Since alcohol is demand driven and highly profitable, the market has taken over the policy which is being monitored and implemented by state.
As far as impact of the act is to be observed, Gujarat still isn’t a top rank holder in terms of safety, crime, health or any reason which is generally cited by people who promote the dry status. Given the parallel bureaucracy of bootleggers and smugglers the whole purpose of banning has failed.
Case 1: The Bootlegger who is Tech Savvy Anand is an education hub with young crowd concentrated around Vidyanagar. The bootlegger albeit uneducated saves the phone number by which people call and then order.
He now has a broadcast group on WhatsApp – a messaging android app. Every morning when he gets the stock, he updates the rates of the stock he has. The rates vary on a daily basis. At times, when demand is high the rate varies on hourly basis too. He realises his role as an intermediary and does his best when it comes to marketing. This bootlegger provides doorstep delivery too.
Case 2: Alcohol just a call away. A regular driver with a reputed organization in Ahmedabad when asked about alcohol replied “Many people ask me about alcohol when they come to this office. If you need it you can save my number and just inform me 15 minutes prior to the time you need.”
When asked about Police, the reply was “Police is lenient in Ahmedabad. The catch when they need money. Once caught just bribe them. Getting caught drunk is equal to getting caught without helmet.”
Annexure 1
Alcohol Bottle with the label “For sale in Punjab only”
