Unhappy hours: Why Delhi is reverting to old excise policy from today

Delhiites will most likely face ‘dry days’ as private wine and beer stores have shut shop from 1 August, as the Arvind Kejriwal-led Aam Aadmi Party government reverted to the old excise policy. This will stay in place for the next six months.

On Saturday, Deputy Chief Minister Manish Sisodia had announced that the Delhi government’s ambitious new liquor policy (Delhi Excise Policy 2021-22) will be scrapped entirely and that from 1 August, only government-owned liquor vendors will be allowed to sell alcohol in the national capital.

This means that 468 retail liquor stores that were running in the city will keep its shutters down as their licences have expired.

What would the rollback of the new excise policy mean for retailers and customers? We give you all the answers.

What is Delhi’s new excise policy?

Before we get into the consequences of rolling back the new excise policy, let’s understand what it entailed and the reason for it being rolled back.

The Delhi Excise Policy 2021-2022 was originally proposed in 2020. After coming into effect in November 2021, it changed the manner in which alcohol was sold in Delhi.

Until then, only government-owned liquor vendors were permitted to sell alcohol. The Delhi Excise Policy 2021-2022 introduced private players in the market. The National Capital was divided into 32 zones and a total of 27 private vendors were to ply in each zone.

Every municipal ward had two-three liquor vendors operating in the area. The private liquor shops were allowed to attract crowds by offering discounts on the Maximum Retail Price (MRP). They could deliver liquor at home, and even keep shops open till 3 am in the morning.

After the implementation of the new excise policy 2021-22, the government’s revenue increased by 27 per cent, generating around Rs 8,900 crore.

Reasons for the rollback

The move to revert to the old policy comes amid an ongoing investigation by Delhi Police’s Economic Offences Wing (EOW) and a face-off between Lieutenant Governor VK Saxena and Arvind Kejriwal-led AAP government.

Earlier, Chief Secretary Naresh Kumar in a report accused Sisodia of providing undue benefits to liquor vend licencees in lieu of “kickbacks” and “commissions” and the money being used in the recent Punjab elections.

It is alleged that Manish Sisodia reportedly waived off Rs 144.36 crore on the license fee, to be paid by the private liquor vendors, under the garb of the coronavirus pandemic. He also caused loss to the Excise Department and benefitted liquor licensees by waiving the import pass fee of Rs 50 per beer case.

The Economic Offences Wing (EOW) of the Delhi Police has also initiated a probe after a complaint alleged that illegal licences were distributed to manufacturing companies and blacklisted firms in violation of terms and conditions of the Delhi Excise Policy 2021-22.

What happens now?

Under the old policy, were 475 government-run shops and 389 privately-owned ones.

The four corporation — DSIIDC, DTTDC, DCCWS and DSCSC — ran the 475 liquor stores. A DSIIDC official informed that around 90 shops of liquor were run by the Corporation on rent. Several of those rented premises are still vacant where the liquor stores can be opened. But the whole process from getting requisite licences and placing order for stocks will take 4-5 days," he said.

NDTV reports that with the new policy out the door, the excise licences issued to hotels, clubs and restaurants having bars, and wholesale operations will also become redundant apart from private run liquor stores in the city.

It means, there will be virtually no liquor supply from the wholesalers to the entire hospitality sector and retail vends in the city after 31 July, till some alternate arrangements are made by the government.

Also, there will be a rise in unemployment, as the private-owned liquor vends, which used to employ a host of people — from salesmen to managers, to even security guards.

Over the weekend, massive crowds could be seen around privately-owned liquor shops in Delhi, as they either slashed prices by half or offered customers schemes such as ‘buy-one-get-one’ on bottles of alcohol to empty their stock before they faced shutdown.

It was reported that popular brands of liquor and beer were sold out by Saturday afternoon. Even premium liquor flew off the shelves at massive discounts, with some bottles even being sold at half of MRP.

With inputs from agencies

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