DMK chief M Karunanidhi's an nouncement that if his party won the 2016 assembly elections he would introduce total liquor prohibition in Tamil Nadu has set off ripples in political and industry circles and triggered a debate on the social implications and fiscal prudence of such a move. But, drowning in the din is the fact that politics and the liquor industry are closely intertwined.
With the government controlling retail sales of liquor as well as manufacture through supply of molasses to liquor manufacturers, the dominant players in the market are those blessed by the ruling dispensation. Traditional liquor companies have often been burned by changes in the fortunes of the politically connected in this business.
At least six of the 18 distilleries and breweries enjoy political patronage and take in a major part of the nearly 12,000 crore (2013 figures) that Tasmac pays out to wholesalers. While Midas Golden Distilleries is run by Karthikeyan Kaliyaperumal, a relative of Ilavarasi, niece of chief minister J Jayalalithaa's close associate Sasikalaa, at least five other distilleries and breweries have the backing of DMK leaders.Golden Vats Distilleries is managed by close associates of former Union minister and DMK leader T R Baalu. Elite Distilleries and A M Breweries are run by family members of former Union minister and DMK sympathiser S Jagathrakshakan. S N Jayamurugan, who produced two films scripted by DMK chief M Karunanidhi, got the sanction or letter of intents for SNJ Distilleries in 2010 when DMK was in power.
Given DMK's record on prohibition and the involvement of his partymen in the liquor trade, Karunanidhi's U-turn on prohibition is seen as an attempt to strike a chord with women and youth and revive his party's flagging fortunes in the upcoming elections. While the AIADMK government is yet to bite the bait, state ministers and party spokesmen and women have slammed their political rivals for reviving the prohibition call. But, the party is yet to take a strong, official stand on the issue that's growing emotive.
Meanwhile, industrial stakeholders have dismissed the call for total prohibition as “unsustainable“. “It would be completely counter-productive to suddenly impose prohibition,“ said Sipping Spirits Pvt Ltd director Prasanna Natarajan. “It has to be a slow and steady process and done in a phased manner after studying the ground reality . Prohibition is not a magic wand to bring about a complete social change. Drinking as a habit can be controlled when it's socially visible,“ he said, pointing out that addicts were bound to take to illicit hooch, medical alterna tives and psychotropic drugs with disas trous results. He suggested that medi cally certified habitual drinkers can be allowed access to alcohol through ration cards. “Not total prohibition but moder ated prohibition is the best option,“ said Natarajan.
Meanwhile, economists like D K Srivastava, a former member of the fi nance commission, feel that prohibition in a state like Tamil Nadu, heavily de pendent on the alcohol industry and alcohol consumption, could lead to a thriving illegal trade, especially near the state borders. It could also put a big question mark on welfare schemes much of which are funded from revenue from the liquor industry . “Put prohibi tion along with GST and Tamil Nadu would lose all autonomy over its reve nue,“ he said.
