Liquor

S Anand writes in Outlook:

Both retail and wholesale vending of liquor in the state is controlled by the Tamil Nadu State Marketing Corporation Limited (Tasmac), launched in 1983. During MGR's chief ministership, the state decided to control all wholesale vending of India-Made Foreign Liquor (IMFL). In October 2003, the J. Jayalalitha government took over retail vending as well, ostensibly to put an end to the "cartelisation in the liquor trade". The M. Karunanidhi-led DMK government has found no reason to reverse the policy since revenue from the sale of liquor has broken a 23-year-old record.

'Drinks are bad for you, your home and the nation'. This is a warning you will see prominantly displayed in all liquor retail shops in Tamil Nadu. I am not sure, but i think it's mandatory for them to do so - like the health warning on cigarette covers.

(While we are on that subject, bidi makers in andhra pradesh are up against a rule that asks them to display a danger symbol (skull etc) on beedi covers. Their voices are louder now because there is an election around the corner. I read in BL yesterday that the government might relent because it thinks the rule would affect the livelihood of beedi workers.

I wonder if you still need magnifying glasses to read the statutory warning on cigarrette packets. Compare this to the large photos of decomposing lungs you get to see on them in developed countries. I don't know what to make out of such government rules - but, clearly, the question in this case is why impose it on beedis and not on cigarettes, or for that matter on cigars. Lobbying power?)

Back to alcohol, the irony about the gloomy warning is that those shops are run by the government itself. If government thinks that alcohol is bad for home and the country, and yet has no qualms about selling the stuff to fill its own coffers, what happens to the leftist argument it's the market that doesn't care about what's good and what's bad, and that the market needs government intervention to make it behave?

I dont see any point in government banning alcohol, or for that matter, drugs. (That people will find a way around them is just one of the reasons. Medical shops in Tripura place huge orders for cough syrup, only to send them across the border to Bangladesh and sell to people who see cough syrup as an alternative to alcohol, banned in B'desh for religious reasons. Btw, India is building a huge fence between the two countries - not to stop the movement of cough syrup, but, it says, to stop illegal immigrants. But that's a different story.) Less so in a government selling them.

In any case, it's doing a bad job even in that. Anand goes on:

Not only are Tasmac outlets filthy, they also force brands like Cosmopolitan whiskey and Day & Night rum on buyers. Sometimes even Romanov and Blue Riband are unavailable. Says veteran journalist Sam Rajappa: "These rotgut, local brands are badly distilled molasses. Tasmac peddles arrack packaged as IMFL." Breweries in TN ensure that other brands don't get a foothold in the state.

Meanwhile ET reports:

THE European Union (EU) has challenged the Tamil Nadu government’s policy of prohibiting sale of imported liquor in the state claiming that the provision went against India’s obligations under the World Trade Organisation (WTO). The EU’s complaint against the state’s retail policy for liquor is in addition to its other accusation that the actual import duties charged by the country on wines and spirits is much higher than the level at which the country has bound its duties at the WTO.

The EU has sought consultations with India at the WTO on both the issues and if the two fail to reach an amicable solution to the problem, it could blow up into a fullfledged dispute.

In a submission made to the dispute settlement body of the WTO, the EU pointed out that measures taken by the Tamil Nadu government to establish a legal basis for awarding licences for the sale (including wholesale and retail distribution) within the state of wines and spirits produced in other Indian states, but not for sale of wines and spirits imported into India from other WTO members. Therefore, state authorities do not issue licences for sale of imported wines and spirits.