Open? IMFL system gets Jharkhand 74% more excise revenue

An ?open? excise & prohibition policy from April 1, 2009, with the maximum retail price (MRP) being the backbone of the new system, has helped the state?s excise & prohibition department earn higher revenue by almost 74% over 2008-09.

Jharkhand earned excise revenue of around Rs 190 crore in 2008-09 which touched around Rs 330 crore in 2009-10.

In volume terms around 9 lakh cases of (Indian made foreign liquor) IMFL got sold in the state in 2008-09, sales shot up to 13.25 lakh cases in 2009-10.

?By making the market open and thus ending the monopoly of the cartel the excise secretary took a bold step in early 2009,? said a retailer.

During the four years of the ?contract? system from 2004-05 to 2008-09 Jharkhand?s entire IMFL liquor business had been in the hands of the ?syndicate? which had been controlling it by way of bidding and winning liquor licences for each of the districts, with prior owners of the retail outlets having been made to sit on the sidelines.

The ?contract? system also did not permit the excise & prohibition department to fix an MRP on the IMFL products being sold in the state.

?Fixation of MRP by the excise department today (since April 1, 2009) has also benefited the consumer; today he is not paying an arbitrary price that was being fixed by the cartel,? said another IMFL retailer.

According to excise department sources, with the IMFL segment growth in Jharkhand, in volume terms, expected to be in the 20%-25% range this year, excise revenue for the state too was likely to go up to around Rs 400 crore during the current year (2010-11).

UB, Radico Khaitan, Jagjit Industries, Seagram, BDA, Mohan Meakin, Bacardi, etc are some of the players who, like in most states, have a strong presence in Jharkhand, with UB leading the pack with around 65% of the IMFL market share.

Jharkhand has two major distilleries functioning in the state; while Ajanta Bottlers & Blenders having a tie-up with the UB group produces solely the group?s high-volume IMFL brands being sold in the state, the other, Gemini Distilleries, produces brands belonging to Radico Khaitan, Jagjit Industries and BDA.

Excise department sources also said that sales of beer too in the state had doubled from around nine lakh cases (of all brands) in 2008-09 to around 18 lakh cases in 2009-10.

?Consumption of beer is expected to grow by around 50% in the current year,? they said.