Nitish Kumar's first decision after taking over as the new chief minister, to impose an allencompassing ban on alcohol,

will take Bihar back by 40 years. In 1977, Karpoori Thakur, Kumar

and Lalu Prasad's mentor, too had banned alcohol - but it lasted only a little over a year.
When the ban comes into effect on April 1, Bihar will become the third state under prohibition
after Gujarat and Nagaland.
The idea of the ban came to Kumar on July 9 when he was at a function related to women's selfhelp groups in Patna. After he finished his speech and returned to his seat, the women in the
audience complained about the widespread addiction to country liquor in rural areas and
demanded a total ban on alcohol. At first, Kumar was taken aback, but returned to the podium
with a smile: "You are correct. If I retain power, I will impose a ban on liquor in the state."
Kumar has kept his promise. "I have directed my officers to begin work for the formulation of the
new policy which will come into effect from April 1," he said recently. The chief minister blamed
increased liquor consumption as one of the causes responsible for domestic violence and said its
consumption created "strife in the family". (GOING DRY?)
The decision runs contrary to Kumar's earlier decisions, which were seen - at least by his now ally
Lalu Prasad - loaded in favour of alcohol consumption. In fact, Prasad had often accused Kumar of
promoting alcohol sale indiscriminately in Bihar.
Legal consumption of alcohol did rise in Bihar during Kumar's tenure. It is estimated that
between 2005 and 2015, the number of alcohol shops doubled in Bihar. In 2006, Kumar
established the Bihar State Beverages Corporation to provide suppliers remunerative prices,
make liquor available at reasonable prices, maintain buffer stock and intervene in the market for
price stabilisation.
These steps gave the state's finances a huge leg-up. In 2004-05, a year before Kumar first
became the chief minister, the state's earnings from excise on liquor were Rs 272 crore, or 8.15
per cent of total own-tax revenue. In 2013-14, the earnings had shot up to Rs 3,300 crore and
their contribution to the state's own-tax revenue increased to 15.60 per cent.
So far, Kumar has not explained how he will make up for this revenue loss, which looks all the
more ominous, considering the state's fiscal parameters are not healthy. Bihar's gross fiscal
deficit was 6.3 per cent of the state's gross domestic product (GDP) in 2013-14, way above the
average of 2.5 per cent for all states.
A bitter taste
Kumar has said his officers will "find ways to make up for the possible loss". But talk to his
bureaucrats and you will realise they are clueless - and angry.
"Our expenditure is soon going to be sky-high. We have to implement the recommendations of
the Pay Commission and the central government has cut its share in the centrally sponsored
schemes," says one officer. He lists other items that require serious investments: the electoral
promises of providing road, electricity and water to every household, and unemployment
allowances. "And now we have decided to shut our second-largest source of income."

Also bitter are liquor retailers, bars and hotels. Especially worried are the retailers and
wholesalers who have placed orders for large consignments - they will have to liquidate them
before April 1, even if they have to do so at a loss.
Politics trumps economics
But does Bihar really have an alcohol problem? The data from the National Sample Survey
Organisation suggest otherwise.
According to it, people in Bihar spend very little on alcohol. The per capita expenditure on alcohol
is around Rs 15.50 a month in the state, which is below undivided Andhra Pradesh (Rs 173),
Kerala (Rs 80.85), and Punjab (around Rs 72). The all-India average is around Rs 35 - more than
double of Bihar's share.
However, a slightly different picture emerges if the per capita expenditure on alcohol is seen as a
proportion of the per capita income. In this, Bihar is placed at the 12th position out of the 29
states and Delhi.
The ban may be bad economics with uncertain social results, but it is smart politics. Kumar
received a lot of votes from women in the recent elections to the Bihar legislative assembly, and
he clearly wants to consolidate this vote bank.
"Kumar knows that he is in command despite the fact that we are the junior partners in the
collation," says a senior Janata Dal (United) leader. "He knows that it will be tough to manage the
aspirations of Lalu Prasad, his family members and his party leaders. Therefore, he wants to be
ready beforehand for any eventuality."
Like Lalu Prasad has a solid vote bank of Yadavs and Muslims, Nitish wants one for himself:
women. Prohibition appeals to all women, cutting across caste and religious barriers.
Kumar had earlier too struck a chord with women through empowerment schemes such as cycles
for girls and 50 per cent reservation for women in the police and local bodies. "Prohibition is our
masterstroke, now they will love him," says the JD(U) leader.
What would happen if the prohibition fails? "It doesn't matter. It's a matter of perception," he
says. "Women want the government to shut down liquor shops in their neighbourhood and we
are doing it."
Lessons from the past
Prohibition in India has met with only partial success. Several states have experimented with
prohibition and eventually repealed it. Alcohol was banned in Haryana in 1996 by the Bansi Lalled Haryana Vikas Party and the Bharatiya Janata Party government. The ban was removed in
1998 after the state government had lost Rs 1,200 crore in revenue.
In Andhra Pradesh, N T Ramarao imposed a ban in 1995. However, the government soon realised
it couldn't fulfill its other promises - cheap rice and electricity - without the alcohol revenue. In
1996, after NTR died and his son-in-law, Chandrababu Naidu, took over as the chief minister, the
ban was lifted. Naidu had admitted that illicit brewing had increased 20 to 30 times after the ban.

Last year, Mizoram ended its 17-year-old ban. Manipur (only in capital Imphal) and Nagaland are
also contemplating doing away with prohibition on alcohol. Earlier this year, Manipur Chief
Minister O Ibobi Singh told the state assembly that it was "about time the prohibition [was]
withdrawn", while Nagaland Chief Minister T R Zeliand described his state as the "wettest dry
state" because of rampant illegal sale.
Gujarat is the only state where prohibition has consistently existed since the 1960s.
The road ahead
Still, Kumar has decided to press ahead. On Friday, he said there will be "complete prohibition" in
the state that will extend to all forms of alcohol. He was reacting to reports that the prohibition
might just be limited to country liquor.
Besides, there are implementation challenges ahead for Kumar's government. One, he will need
the cooperation of the governments of Uttar Pradesh, Jharkhand and West Bengal, where the sale
of alcohol is allowed. These governments will have vested interests and might not be as excited
by Kumar's idea since the increased sale will add to their revenue. This is reminiscent of 1996
when Punjab did little to help Haryana ensure a ban on alcohol sale in the state.
Usually, as in Gujarat, shops proliferate just across the state border. Moreover, Bihar has a long
open international border with Nepal, which is manned by the central government's Sashastra
Seema Bal. Tipplers are likely to troop into Nepal, have their fill and come back. The Bihar
government's loss will be Nepal's gain.
Two, a correlation can be drawn between an increase in deaths owing to the consumption of toxic
liquor and prohibition. Take Gujarat, for instance. The National Crime Records Bureau recorded 29
cases of consumption of toxic liquor in Gujarat in 2013. Neighbouring Rajasthan had zero cases.
However, the removal of ban doesn't necessarily ensure an absence of deaths due to toxic liquor,
as was evident in over 100 deaths in Mumbai due to consumption of poisonous liquor earlier this
year.
One thing is clear: politics, as always, has the final say.