Why Bihar’s liquor ban isn’t working

Across Bihar, huge billboards with this piece of advice can be found in every city, village and marketplace. Chief minister Nitish Kumar features prominently on them, as does a toll-free number encouraging people to tip off the authorities on consumption, stocking, sale and manufacture of liquor.

Alcohol consumption has been banned in Bihar since 2 October 2016, Mahatma Gandhi’s birth anniversary, vide the Bihar Prohibition and Excise Act, 2016.

On 26 November 2021, in a highly publicized event at the Gyan Bhawan in Patna, chief minister Kumar and some key public servants renewed an oath to never consume liquor and pledged to undertake steps for the implementation of the liquor ban across the state. On that same day, Bihar director general of police (DGP) SK Singhal administered an anti-liquor oath to personnel at the police headquarters in Patna to ensure full implementation of the ban on alcohol consumption.

A police official posted at Samastipur district confirmed that detecting and preventing alcohol consumption is a big part of his job today. “Every time there is a spurious liquor death, the focus of the entire administration shifts to liquor. The pressure is such that police are running from pillar to post to catch liquor offenders. The toll-free number has also become a tool to settle personal vendettas."

However, the optics aside, Bihar’s parallel liquor economy is burgeoning.

The officials may be swearing an oath in public to prevent liquor consumption, but in private, some of them are raking in huge sums of money, allowing illegal liquor to flow freely in the state with a wink and a nod, says a bootlegger who has amassed a fortune peddling ‘duplicate’ liquor.

The liquor ban simply isn’t working, as sellers and buyers have found ingenious ways to sidestep it, with the acquiescence of officials. The state’s coffers have taken a huge hit from the loss of excise and tax revenue.

Sanjeev Kumar, lecturer at the department of economics, Dartmouth College, US, says that some of the figures mentioned when prohibition was announced in 2016 suggested that the state would suffer a revenue loss of around ₹4,000 crore. “Even a conservative growth (estimate) … would give you an annual liquor market of ₹8,000-10,000 crore a year over the last six years," says Kumar, who is also affiliated with Human Nature Lab, Yale University.

Meanwhile, there is another, darker side to Bihar’s illegal liquor trade. Since the ban was first instituted in 2016, scores of people have lost their lives consuming hooch. Six people died after consuming illicit liquor in Bihar’s Buxar district mid-January, making it the fifth hooch tragedy since November last year, after several succumbed in Gopalganj, West Champaran, Nalanda and Saran. News reports indicate that as many as 60 people have died after consuming hooch in Bihar since November 2021. Another worrying fallout of the ban is the growing drug use among youth in towns and cities.

Duplicate, original and desi

Bihar’s parallel liquor market has three broad categories. D maal or duplicate liquor, which is made using spirit, constitutes 50% of the market. English (Indian-made foreign liquor) or branded maal accounts for 25%, while desi/chulai accounts for the other 25%.

While branded liquor is consumed by the well-off, chulai is for the lowest rung and has been around forever, with consumption shooting up after the ban.

A resident of Gopalganj district, 40 years old, says he’s been paying almost double the MRP (maximum retail price) for his liquor since prohibition kicked in.

The premium, however, has not deterred him and his ilk from consuming liquor every evening. “Whatever the price, those who want to drink will drink," he says, adding, “earlier we had to go to the liquor shop; now, it’s all home delivery."

In towns and cities, schoolchildren and college students with bikes or scooters work as delivery boys while unemployed youth, of which there are many, are the best bet in villages.

The bootlegger quoted earlier has been in and out of the jail three times and is currently out on bail. A corner of his 400 square foot terrace served as his liquor still. It was a fairly simple operation: steel utensils are used to mix the ingredients; old, branded-liquor bottles, caps and laminated labels sourced from a kabadiwala (scrap dealers) serve as packaging material.

Three labourers, each paid ₹1,000 a day, prepare the spurious liquor by mixing water and spirit in equal proportions along with some malt and colour. The concoction is then bottled through a steel dispenser and sold to retailers.

“I’ve made a lot of money in the last 4-5 years selling my liquor," says the bootlegger. A small player himself, he says there are scores like him, who invest ₹10-20 lakh per consignment. But, he adds, it is the big mafias that dominate the branded and D maal sourcing market.

Modus Operandi

The liquor mafia usually ties up with a dalal (broker) whose job is to arrange for a genuine challan (receipt) for spirit dispatched from a sugar mill in Bihar to a company in a neighbouring state: West Bengal, Jharkhand or Uttar Pradesh. This challan is worth 3% of the cost of the spirit. Usually, a tanker contains 20,000 litres of spirit (a mid-level player later pays as much as ₹10 lakh for 4,000 litres of spirit).

Once the challan is with the mafia, money is paid in advance to the sugar mill through national electronic funds transfer (NEFT) with a proper stamp and company licence number. The driver and vehicle, however, belong to the mafia. Armed with the genuine challan and documents, the vehicle heads to one of the bordering states.

In order to ensure that the spirit reaches its genuine buyer, the sugar mill uses only vehicles fitted with GPS. However, once the tanker crosses the border, the GPS device is shifted to a smaller vehicle, which then goes to a location near the consignee’s address and parks there to make it seem like the tanker has reached its destination.

Meanwhile, the tanker heads to a ‘cutting’ location, where the spirit is shifted into around 100 drums of 200 litres each. The mafia has an understanding with the administration and police at these locations in Jharkhand, West Bengal and Uttar Pradesh through its local contacts. Dalkhola in West Bengal is one such location that repeatedly finds mention in conversations with senior police officers in Bihar.

The smaller consignments are pre-booked by a ‘party’–local parlance for a mid-level player–who usually buys 20 drums for ₹10 lakh. At the time of booking, this player shows the mafia bhai (don) the cash he will pay over a WhatsApp call and transfers ₹1 lakh as the booking amount. The rest is paid just before delivery, in cash.

The drums are then dispatched to their destinations, concealed under anything from sugarcane, onions, potatoes and cauliflower to cabbage, wheat and clothes. They are also sent back into Bihar through interstate buses and boats. Gas cylinders filled with spirit or branded liquor are also used to fool the authorities.

Staying ahead of the law

A police officer in Gopalganj district explained why the authorities are helpless against the smuggling: “There are no scanners and drones that can identify what is inside a tightly packed and camouflaged truck. Hundreds of vehicles pass through the borders every day, and we can manually check only a few."

A day before delivery, the ‘party’ is informed about the drop location and pays the balance due to the mafia. Once trust is built, payment is also accepted on the delivery day.

Smaller consignments are usually carried in SUVs and pickup vans and are usually escorted by bikers, who alert the main vehicle of any potential check-ups.

In case, a vehicle is intercepted before it reaches its destination’, the cost of the impounded vehicle, the legitimate shipment (cabbage, cauliflower etc) and the liquor has to be borne by the ‘party’. For this reason, old vehicles and vehicles without documents are usually used for delivery.

Branded liquor is smuggled across the border in much the same way.

“There is a setting with the authorities for every little thing," avers one mid-level player. Deals are struck for pickups, sale, and even to have a smaller consignment caught while a bigger one passes through.

Some people allege that even when consignments are caught by officials, there is no one to authenticate or audit what has actually been confiscated. “Only 30-40% is declared. Photos are taken and videos are made of those bottles being crushed. But 60-70% of the maal finds its way to a stockist," quips a retailer.

The local police force generally looks the other way in order to maintain a working relationship with the community. Any arrests are made by the district-level police. “But even if the district police pick us up, we will quickly get bail," says an ardent drinker from Sasaram district.

A police official in Muzaffarpur district says the judiciary and police are overburdened with liquor cases. “There are even special lawyers whose job is to get you quick bail. Jails are overcrowded, so it’s convenient to grant bail."

Make in Bihar

Country liquor or chulai is usually made in the homes of those on the lower rungs of the caste ladder. All the ingredients to make the moonshine— jaggery, bhakargoti, yeast and urea— are available at the nearby grocery shop at nominal rates. However, bhakargoti, the main intoxicant, is only handed over to familiar faces in the production chain.

Sold in polythene packs, the moonshine is easily produced in homes, deserted areas, dense plantations or riverbeds using a few aluminium utensils and a stove.

As a police officer in Sasaram district explains: “It’s impossible to know what’s cooking inside a house. Earlier small-time contractors used to get it made by lower-caste women, so there was still a chance of nabbing the contractor."

After the women understood the profits and mastered the art of making chulai, they started selling it themselves. “In a way, it’s providing them an earning sitting at home, without any vigorous labour," he adds.

Economic impact

Before prohibition took effect, collections from the sale of liquor accounted for a big part of Bihar’s revenue. Data provided by the department of Prohibition and Excise, in response to an RTI (right to information) request, points to a whopping decline in the department’s revenue, from ₹3,150 crore in 2015-16 to ₹4.91 crore in 2017-18.

Prohibition pushes the liquor business into the black market and hits the state’s economy, particularly tourism. Nirupama Soundararajan, head of research and senior fellow at Pahle India Foundation, cites the example of Kerala. When the state changed its excise policy and phased prohibition began (in 2014), the growth in the MICE (meetings, incentives, conferences and exhibitions) tourism segment dropped sharply, first to 4.8% in 2014, and then to a negative 0.6% in 2015.

A trade survey undertaken by the department of tourism in Kerala in 2016 found that the state’s tourism growth rate had fallen from 8.1% in 2013 to 7.6% in 2014 and 5.9% in 2015. The study found that the dramatic decrease in tourist footfalls, especially foreign visitors, and the drop in MICE tourism was singularly because of the new excise policy.

“Even for a state like Gujarat, in the interest of tourism, permits are issued to both domestic and foreign tourists for the consumption of alcohol," she says.

Experts say that if the objective of prohibition is to improve health and end domestic violence, it has to be achieved through a well-thought-out policy. “If you really want to enforce alcohol prohibition, then there should be parallel investments in policing, rehabilitation centres, campaigns and counselling from the school level, and ways to handle cases without making things worse for the judiciary," says Nishith Prakash, associate professor of economics, who is in a joint position with the department of Economics and the Human Rights Institute at the University of Connecticut, Storrs.

Typically, alcohol prohibition is used as a political card, especially to woo women voters. “But does prohibition truly solve their problems? The answer is no. Those who are used to consuming alcohol or are addicted to alcohol end up consuming hooch and other illegal alcoholic substances, which leads to more deaths," says Soundararajan.

Kumar from Yale says that though the intention of the Bihar government was good, the imperatives of electoral politics have proved to be hurdles in having a pragmatic policy in place. “A complete ban leads to … illegal activities and compromises the state’s capacity to deliver other public goods."

Clearly, many in Bihar believe there is more than one path to success, with intoxicants aplenty by the wayside.