UP in high spirits as excise revenue soars

Lucknow: Uttar Pradesh is in high spirits. The state has recorded excise revenue generation of Rs 42, 250 crore in FY23 -- a threefold increase from Rs 14,000 crore recorded in 2017-18, the year BJP and Yogi Adityanath came to power.

UP has surpassed Karnataka when it comes to liquor revenue to become number one. But like Karnataka, UP has no Bengaluru, the IT hub and home to high-earning youth who are regular bar hoppers and host house parties.

“Karnataka is now a distant second. Our policy completely moved the industry from a license fee-based system to consumption-based system to break the monopoly. We also restricted the number of shops to two per person. The allotment pattern was changed to the e-lottery system from the earlier auction-based model. We have used technology to put track and trace systems in place,” said Senthil Pandiyan, Excise Commissioner.

The amendment in the excise policy by the UP government has overthrown the monopoly of the big players and has made it possible for small business persons to enter the liquor field, says Aggarwal.

The state excise department has reported a revenue growth of 16 per cent during the first six months of the previous fiscal year.

This has been due to an increased demand for liquor and stronger enforcement against illicit liquor and smuggling from neighbouring states.

Unlike Delhi government’s controversial excise policy of 2022-23, where licenses were granted to liquor traders through open bidding, UP has the e-lottery system that allows small players to enter the industry.

The controversy over the Delhi excise policy and lack of availability of preferred brands in the national capital, also created an opportunity for the UP-NCR districts (Noida and Ghaziabad).

According to a review carried out by the department, revenue collection has been Rs 18,562 crore from April 1 to September 30 this year as against Rs 16,025 crore in the corresponding period last year -- a rise of Rs 2,537 crore.

Former additional chief secretary, excise, (now retired) Sanjay R. Bhoosreddy, said, “Our team worked according to the action plan that had been finalized for the financial year. We have also taken steps to improve the ease of doing business and hence more brands are available in the state.”

Lucknow has been the highest money grosser for the department while Noida, Ghaziabad, Meerut, Kanpur, Varanasi, Prayagraj, Gorakhpur and Bareilly have also been at the forefront.

Smaller districts like Kushinagar, Shahjahanpur, Sonbhadra, Deoria, Lakhimpur Kheri, Hardoi and Chitrakoot have also reported higher revenue.

Officials said that six distilleries have been set up this year and seven more will be ready by the end of this financial year.

While demand for beer went up by 40 per cent due to intense heat, the department is banking on the sale of rum and whisky in the coming months.

Senthil C. Pandian said, “An increase of revenue has been ensured for the government coffers. We have identified some districts where sales have been low and are ascertaining the reason for the drop.”

Along with rising revenue, the complexion of the liquor business has also changed drastically.

Liquor shops are no longer dingy, poorly lit kiosks with intimidating wire mesh to keep customers at a distance.

Liquor is now being sold in swanky stores in high-end shopping malls. The stores have a variety of brands on display and the décor is equally inviting.

What has made the difference is the fact that women and girls now confidently walk into these swanky stores to buy liquor.

“Our female customers do not display any hesitation in walking in and asking for their favourite brands. The change has given a major push to business and we are even outing up ‘happy hours’ in some model shops,” said Devesh Jaiswal, who owns one of the swanky shops in a Lucknow mall.

Excise officials say that the new policy has the backing of Chief Minister Yogi Adityanath who incidentally frowns at the very mention of liquor.

“However, he is happy that illicit liquor trade has been checked and revenue is increasing,” said a senior official.