Maharashtra: 45 years on, state govt plans to grant new wine shop licences

Almost 45 years after it stopped issuing fresh permissions for wine shops, the state government is planning to grant new licences, albeit through the backdoor. The state is looking at allowing Indian Made Foreign Liquor (IMFL) manufacturers to start retail vends across the state.

"We are planning to allow wine shop licences for potable liquor licence (PLL) holders," a senior state government official said. "For a state that has a population of 11.23 crore, Maharashtra has just 1,737 wine shops, of which just 1,620 are functional. This is much less than states like Karnataka which have a lower population. It affects state excise revenues," he added. According to him, demand is affected if people cannot access wine shops where liquor is sold in sealed bottles for off-consumption and is cheaper than permit rooms and bars.

This lack of access to authorised vends can also lead to tipplers turning to smuggled, duplicate or illicit brews, he noted.

Due to opposition from prohibition activists, no new wine or country liquor shop licences have been issued since 1973.

Since new wine shop licences cannot be given out, the old ones have to be transferred or shifted. "This has led to the creation of a monopoly as no new licences have been issued," he said.

The official noted that they were considering granting permissions for PLL licence holders to start their own liquor shops. "Now, they have one licence to start a retail vend in the state. These stakeholders are demanding that this limit be increased to one in each district or at least five in the state," he added, stating that Maharashtra had 42 such functional IMFL manufacturers. Officials admitted that this amounted to the "back-door grant of new wine shop licences."

"This is under consideration though a final proposal has yet to be drafted," the official said. Sources said the state government was likely to tread cautiously on the issue due to political implications.

The proposal is also likely to meet with opposition from pro-prohibition activists who point to the social effects of alcohol consumption.

Country liquor sales in Maharashtra from April to September 2017 was at 1,469.63 lakh bulk litres (LBL) as against 1,591 LBL for the same period in 2016 – that's a fall of 7.63%. IMFL off-take stands at 14.33% less at 795.46 LBL against the previous 928.53 LBL.

Beer and wine sales have declined by 16.52% and 13.04%, respectively, to end at 1,425 LBL and 25.88 LBL versus 2016's 1,707.28 LBL and 29.76 LBL.

In 2016-17, beer sales fell by 0.95% to end at 3,285.78 LBL against 3,317.32 LBL in the previous fiscal. IMFL sales increased by 2.99% at 1,930.53 LBL compared to 1,874.51 LBL in 2015-16 and CL consumption rose by 2.41% to 3,254.51 LBL against 3,177.83 LBL. Wine sales grew from 61.57 LBL to 64.70 LBL (5.09%).

The state excise department is the third highest revenue source for the Maharashtra government after State Goods and Services Tax (GST) and stamp duty and registration fees. For 2017-18, the state excise has set a target of Rs 14,340 crore, 39.46% (Rs 5,659.1 crore) of which had already been met by September.