Lok Satta

Friday, 04 May 2012 04:55

Analysis - April 2012

PDFPrintE-mail

Analysis—Liquor Policy

The recent promotion and subsequent transfer of ACB Additional Dir. K Sreenivas Reddy has stirred a fresh controversy in Andhra Pradesh. Over the last three months, the ACB official has led a series of investigations into the liquor mafia which led to arrests of excise dept. officials and police personnel and revealed large scale malpractices and corruption related to the liquor trade. Allegations are that the official has been promoted to keep him away from the investigation as part of a political deal brokered between the Chief Minister N. Kiran Kumar Reddy and the APCC Chief Mr. Botcha Satyanarayana. Under pressure from the ACB investigations, Mr. Satyanarayana had revealed to the media that he along with his relatives own about 36 shops across the state. With the transfer, the APCC Chief is said to have exacted revenge on Sridhar Reddy and also achieved a political victory over the Chief Minister, who is said to have ordered the investigation. All in all, the state seems to be the loser again as the truth has been scuttled in favor of political calculations.

So, what exactly is the issue here? Well, for starters, the State is said to be losing Rs 5,000 Cr per annum from illegal liquor sales. The increasing alcoholism that the state is witnessing along with growth in sales of illicit liquor is another important concern.  It all started when TDP leader and then Chief Minister Chandra Babu Naidu repealed the prohibition of liquor act in 1996 with the excuse of generating more funds for the state and its welfare policies. Later in 2006, the Y.S Rajeshekar Reddy led Congress Government brought in liquor auctions raising Rs 620 Cr in 2005. In 2010, the government raised a monstrous amount of Rs 6990 Cr, with licenses being bid for up to 5 Crores in some places. However, huge license fees have put pressure on the traders to push through more liquor sales and indulge in malpractices such as illegal liquor sales, above-MRP sales, sales beyond regular hours and setting up illegal ‘belt’ shops in villages. Apart from this the traders are also selling illicit liquor. It has been reported in the media that the number of deaths due to Gudumba have been increasing in the past few years; these deaths have left behind many young rural women widowers.

Proceeds from Last 4 Auctions

Sl. NO

Lease Period

No. of Shops

Notified

No. of Shops Auctioned

Lease Amount

(Rs in Crores)

2005

2005-2006

6596

6586

620

2006

2006-2008

6596

6588

1647.7

2008

2008-2010

6596

6594

3182.04

2010

2010-2012

6596

6596

6990

Source: State Budget 2012-13

Liquor shops are usually run by a syndicate, which typically owns a bunch of shops across few districts. In ACB investigations, it was found out that the syndicates routinely bribed excise officials, police dept. personnel, media and politicians in order to escape scrutiny. According to many sources, the ACB has reported to the Govt. that the Excise Minister Mr.  Mopidevi Venkata Rama Rao was paid Rs 10 Lakhs as bribe by a liquor baron in Khammam. ACB is also said to have found out that 406 liquor shops were owned by benami traders, with a large number of being White Card holders. In the past three months, ACB has arrested a number of excise officials and police personnel across the state in connection with the investigations. [See, end of article for a table on the corruption amount paid to govt. officials across various districts]

Money gained through this business is usually directed into politics to fund the elections of political aspirants. Balraj Goud who was recently arrested by the ACB in relation to the case was a syndicate boss who also contested for the Praja Rajyam Party ticket from the Mahububnagar MP constituency. It is common knowledge that leaders of Congress, TDP, YSR Congress and the erstwhile PR are involved in this business. It is the same reason why these party leaders are not seriously pursuing these charges against the Govt. for fear of being dragged into it.

District wise shops and those procured by the Political Parties.

District

No of Shops

Congress

TDP

PRP

Anantapur

236

150

50

 

Kurnool

194

83

79

32

Chittoor

452

91

24

8

Prakasham

321

160

100

20

Vizianagaram

202

100

60

 

East Godavari

555

200

125

75

Nellore

348

100

60

20

Mahaboob Nagar

158

90

50

 

Adilabad

207

125

30

 

Nalgonda

241

80

40

 

Source: - Andhra Jyothi, June 16th 2010 ( Anthaa  aa Brandey)

 

This year AP is expected to earn Rs 16,000 Cr from liquor sales which is going to be used various govt. programs for the poor. Whereas the liquor trade in AP is estimated to be around 50,000 Cr, of which about 75% is consumed by the poor. In order to fund programs to support the poor, we are ending up further depriving them!!! The state is also failing in its mission of controlling the amount of liquor sold through a fixed number of shops as a large number of belt shops exist in villages. The current state policy fails both monetarily and morally and is harmful to the poor. We at Lok Satta Party believe that the Govt. should take over the retail side of liquor. This move will effectively control the sale of liquor, curb the malpractices and will also bring in more revenue. Case in point being our neighbor state Tamil Nadu, where over the past ten years the govt. has been running the retail trade under the TASMAC banner and last year the TN Govt. earned Rs 18,000 Cr in revenue compared to 12,000 Cr that AP earned. Apart from this, the government should launch a state-wide awareness programs sensitizing and educating the people on the evils of consuming illicit liquor and also start de-addiction programs for chronic alcoholics. The government should also pursue the investigations started by ACB and ensure the people involved in these illegal activities are suitably punished by a court of law.

District wise Highest Bid and the Political Party that owner is associated withSource: - Andhra Jyothi, June 16th 2010 ( Anthaa  aa Brandey)

District

Highest Price (in crores)

Political Party

Anantapur

1.96

Congress

Kurnool

3.50

TDP

Chittoor

2.20

-

Prakasam

2.56

Congress

Vishakapatnam

4.72

Congress

Vizayanagaram

2.77

Congress

East Godavari

3.06

PRP

West Godavari

2.65

PRP

Krishna

3.11

TDP

Guntur

5.22

PRP

Nellore

 

Congress

Warangal

3.45

Congress

Karimnagar

2.51

TDP

Nalgonda

3.70

-

Ranga Reddy

4.55

TDP+Congress