With a bid to rake in more cash from the sale of liquor, the Telangana government has increased excise duty on all brands of alcohol in the state.
"There will not be a big change in the MRP of liquor for consumers. We have only added Rs 10 to the price. So something that cost Rs 90 before, will cost Rs 100 now. This was our main aim. We also removed some anomalies that were present in the pricing of costlier brands," M Santhosh Reddy from the Telangana State Beverages Corporation Ltd told TNM.
However, when asked if the notification was approved due to the cash crunch that the state was facing after demonetisation, the official denied such reports.
"We had received the proposal a long time ago, but approved it now," he affirmed.
According to reports, the notification for the new rates, which came into effect on Friday, was signed by special chief secretary Ajay Mishra just before his transfer.
The move is expected to fetch a few extra hundred crores to the state's coffers.
Considering that Telangana's revenues are expected to come down by nearly Rs 3,000 crore during the current financial year as a result of demonetisation, this will help the state's finances.
However, others have already termed the move unfair.
"Neither the liquor manufacturers, dealers nor consumers will benefit with this price hike. The government has already procured liquor stocks at old rates from manufacturers and is now supplying the same to dealers for new rates. These bottles will be sold to consumers for the new price. This way the government would get double benefit," D Venkateshwar Rao, the president of TS Wine Dealers' Association told Deccan Chronicle.
Earlier this year, a survey had found that Telangana ranks third in alcohol consumption in the southern states, with men between ages 45 and 59 consuming the most liquor. It had also found that 5.1% of youth between the ages of 15 to 29 consume alcohol in Telangana.
It was further reported that the number of pubs in the state is likely to go up from the present 547 to 600 with the the government reducing population criterion for issuing a bar licence.
With districts being reorganised in October, the number of bars and liquor outlets are also expected to grow. In October, the state undertook a massive district rejig, by adding 21 new districts to the already existing 10.
The state said that the new districts were being created for administrative convenience and better governance.
As a direct consequence, it was soon reported that bars and liqour outlets were also expected to grow as important towns and cities would get their fair share of outlets.
However, the excise department is laying down strict guidelines for bar owners, in the context of the recent drunk driving cases in Hyderabad.