Written by Khagesh Gautam and Yashowardhan Tiwari
Cannabis use for religious-spiritual, medicinal, and personal purposes has been an important part of Hindu culture and society. The weight of scholarly opinion seeking the legalisation of cannabis for medicinal, and recreational/personal use has seen an upward trend. This trend may fairly be seen as the culmination of more than a half-century-long debate around its criminalisation. One of the key arguments favouring legalisation has been the economic argument — allowing cannabis use and converting the cannabis market into a reliable tax base with a steady revenue stream.
It’s rather strange that India, a nation with a history of cannabis use going back to ancient times, has not been able to critically examine its criminal prohibition of the substance. The recent call for open consultation on the NDPS Act, 1985, by the National Level Committee for Reforms in Criminal Laws constituted by the Union Ministry of Home Affairs, is a welcome step in this regard and has opened up the possibility of having engaging discussions with wide-reaching consequences on the subject.
The economic case for the cannabis decriminalisation in India, its legalisation, and fair and just regulation is a logically strong one, given the fact that India is a constitutionally-proclaimed welfare state. Such a state needs huge revenue resources to meet its constitutional obligations while maintaining the thin balance between harsh state regulations on the one hand, and precious personal, and commercial liberties on the other. Also, the COVID-caused global economic slowdown, and the heavy cost it will make our public health system pay, makes it all the more urgent for fresh, reliable, and steady sources of public revenue to be sought. Cannabis trade is one such source. In the not-too-distant past, cannabis for personal consumption was legally regulated, and fairly taxed in India.
Evidence emerging from the experience of various states in the US that have re-legalised trade in cannabis quite convincingly shows that this is a reliable and steady source of state revenue. Colorado was the first state in the US to begin actual sales of cannabis for recreational/adult-use in early 2014. Since then, 11 states, and the District of Columbia have made cannabis sales for recreational/adult-use legal. With the actual sales having begun in nine of these states, as of August 2020, the total tax revenue generated in these jurisdictions is estimated to be a whopping $5.8 billion. Despite varying tax rates and different periods since legalisation, a common trend witnessed across most of the jurisdictions is the steady streams of revenue pouring in, with a constant increase in revenue over time. One may safely conclude that the cannabis market has proven to be a reliable tax base.
In addition, legalising trade in cannabis frees up additional state resources. For example, if trade in cannabis in India is decriminalised, a substantial amount of currently pending cases in trial courts would simply cease to exist. If the very law under which a person was going to be charged, or tried and convicted, ceases to exist, there is no reason for that case to go on in court, or for the police to keep on investigating such cases. Those who are currently serving prison sentences for cannabis-related offences can be pardoned, or paroled by the Governor, or the President, as the case may be.
It must be kept in mind, however, that the argument here is only for cannabis. If offences include controlled substances other than cannabis, none of the above would be applicable. However, there are many such pending cases in the system where cannabis is the only substance involved in the offence. If all these cases pertaining to cannabis-related offences are suddenly to be removed from our criminal justice system we would realise that the net stress on the system will considerably decrease.
In addition to this, it will be seen that the legalisation of cannabis trade will result in commercial opportunities being created across the length and breadth of India. The cannabis that will be cultivated will ultimately have to be processed, put through manufacturing processes, packaged, and then shipped to consumers in India, and perhaps even abroad. It is the experience of many states in the US that have legalised trade in cannabis that a sister industry of cannabis tourism almost inevitably springs up with it. All this trade, commerce, and industry circulates currency and creates wealth. This means more for the state in revenue by way of income taxes, and other commercial taxes. It means more job opportunities. It means more wealth for the farmer.
A 2019 study commissioned by the Ministry of Social Justice and Empowerment found that cannabis is the second-most commonly used substance in India after alcohol. The study found that a total of 3.1 crore individuals (about 2.8 per cent of the population) consumed cannabis within the past year. Are we, as a nation, prepared to see 3.1 crore of our fellow countrymen go to jail and serve long prison sentences, because they consumed a substance that grows in nature in the first place, and was not criminally prohibited until 1985? All this while alcohol, a much more dangerous and damaging substance, is legally regulated and has once again proved to be a reliable source of public revenue during the stress several state economies recently had to face because of COVID-19.
A recent study by Vidhi Center for Legal Policy (“A Case for De-Criminalisation of Cannabis Use in India”) found that those worst hit by the enforcement of the criminal prohibition of cannabis are economically and socially the weakest. These include mostly daily wage workers and slum or street dwellers. In Mumbai alone, where 10,669 pending cases before a magistrate’s court were analysed, the study found that 99.9 per cent of these cases included charges that involved “consumption of a narcotic substance” but the details of the substance were not always available. However, whenever details of the substance were available, 87 per cent of those cases were cases of cannabis consumption.
The case for ending the criminal prohibition on cannabis use is strong, logical, and supported by solid research. Besides, there is a long tradition of cannabis use for religious-spiritual, medicinal, as well as personal use in India. The tradition is also one of, if not the, oldest in the world. It was legal till 1985 when our Parliament enacted the NDPS Act. It is time that the part of the NDPS Act that criminalises cannabis be repealed, and its regulation and taxation be left to the state legislatures, just as the case is with alcohol.
Gautam is Associate Professor of Law at Jindal Global Law School and Tiwari is a BA LLB (Hons) graduate (Batch of 2020) from Jindal Global Law School
Cannabis samples inside a laboratory facility in Lesotho. (Bloomberg Photo: Waldo Swiegers) 
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