Alcohol ban in some of the Indian states has been proving detrimental to the tourism industry in today’s scenario. The increased demand for alcoholic beverages is influencing the tourist influx in many cases. The foremost instance is India’s westernmost state, Gujarat. The state continues to practice complete prohibition of production, sale and consumption of alcoholic beverages since the 1950s.
As recorded by the World Health Organisation (WHO) in 2018, the per capita alcohol consumption in India has increased from 2.4 litres in 2005, to 4.3 litres in 2010, and to 5.7 litres in 2016, which finds its root in changes of demographics and spending patterns.
In Gujarat, the complete ban started affecting the state tourism industry and the effect is sensed in early 2000, with the changing business environment in the state and increased acceptance of alcohol around the country. With no other way out, the state tourism department persuaded the government to relax prohibition norms for tourists at least.
As we all know that the tourism sector is interlinked with several other industries such as food services, hospitality, retail and real estate ; any thing that happens to the tourism sector will make a difference to the allied industries. Therefore, to prevent inconveniences like this, the state Government has modified its prohibition policy and allow consumption of alcohol under certain circumstances, with the provision of health permits, tourist permits and group permits for holding business meetings.
In the year 2014, Gujarat introduced tourist permits on arrival at airports and hotels, and individual and group permits through its online portal. And after amendment, the Bombay Prohibition Act, 1963 states, a hotel with “a sufficient number of boarders, is eligible to hold permits” can obtain a hotel licence for selling alcoholic beverages to tourists on premises.
The state had 29 such hotels in 2012, and by 2016, the government granted licences to 23 more. Not only this, the retail shops were also authorised by the state government and were allowed to sell liquor to permit holders directly; in 2014-15. This resulted in total number of 58 retail outlets currently, while it was only 26 earlier.
With all this Gujarat has definitely set an example. The attempts are certainly favourable towards the tourism sector which translated into a high inflow of tourists, both domestic and international, despite it being a liquor-prohibitory state.
Likewise, being inspired by the Gujarat prohibition story, another south Indian state, Kerala also introduced a near-complete ban on alcohol. What makes the state to take such extreme decision, is its alcohol consumption rate that surpassed the national per capita consumption of alcohol. As per records, in 2014, the consumption rate of alcohol in Kerala was 8.3 litres per year, which is well above the national average of 5.7 litres per year.
Undoubtedly, the move led to a decline in the growth rate of tourism in the state, confronting a revenue loss of `700 billion. The declining graph came down from 8.1% in 2013 to 7.6% in 2014 and 5.9% in 2015. This consequential impact on the economy and employment forced the Kerala government to reconsider its decision of alcohol ban in June 2017.
The other Indian states enforcing the alcohol prohibition act are, Bihar, Nagaland and the Union Territory of Lakshadweep. Where ever it may be, the prohibition has its own pros and cons, and its implementation is a challenging task per se. Since the enforcement of prohibition laws poses a big challenge for state governments and leads to a financial burden, in turn, the state governments should focus on encouraging responsible practices in production and consumption of alcohol rather than imposing total ban on it.
