A report recommends ending Bihar’s liquor ban. Why BJP will find it hard

While the ruling BJP, according to a source, is cognizant of the revenue that opening up liquor sales would bring in, it is also mindful of possible offence that tweaking the policy could cause to former Chief Minister Nitish Kumar. For now, the ruling party will take its own time before reviewing the policy, the source said.

In April this year, Bihar marked a decade of complete prohibition on liquor in the state. A research paper by the National Council of Applied Economic Research (NCAER), presented at the India Policy Forum last week, recommended that the state government lift the total liquor ban. Key findings showed that the prohibition has failed to curb crime against women – the core objective former CM Kumar had when he imposed the ban in April 2016.

RJD national spokesperson Subodh Kumar Mehta said the study shows “the utter failure” of the state government. “All political parties had unanimously implemented the liquor ban in the state. We are still in favour of the ban. The study shows the utter failure of the government. It is not only about annual revenue loss, but the creation of a parallel black liquor economy. Reports like this suggest that the state government may try to find a way out of the liquor ban, partially or fully, in due course,” he told The Indian Express.

Views in NDA

While the JD(U)’s official stand favours prohibition, party MP from Sitamarhi, Devesh Chandra Thakur, called for a review. “Liquor ban has not succeeded anywhere,” he said.

Lok Janshakti Party (Ram Vilas) chief and Union Minister Chirag Paswan said: “It is true that we have to find ways to boost revenue, but it does not mean that we should lift the liquor ban.”

Hindustani Awam Morcha (Secular) chief and Union Minister Jitan Ram Manjhi said: “Bihar should follow the Gujarat model of stricter implementation of prohibition.” Earlier, Chief Minister Samrat Choudhary had made it clear that the state government would not revisit its liquor policy.

Regardless of official party lines, serious discussions are underway within the ruling alliance around the ban, sources said. “There has been a drastic increase in the use of alternative intoxicants alongside the creation of a parallel liquor economy. Plus, the hospitality industry can only thrive in Bihar if we open up liquor sales, even partially,” said a BJP source. “But one thing is for sure, the state government will still take its time to revisit its liquor policy. Any tweak in the policy could offend former CM Kumar. A prohibition rollback is a decision in slow progress,” a BJP source said.

What the study says

The study, titled “Macro perspective of Bihar’s development achievements: Unfinished agenda and the way forward” and presented by a team of economists led by Ratna Sahay, noted a “rapid emergence” of an illicit drug market and the use of alternative intoxicants. “Legal drinking was replaced by an increase in liquor trade, bootlegging, and higher consumption of alternative intoxicants,” it stated.

According to the study, prohibition continues to cause heavy annual revenue losses to the state exchequer, estimating that lifting the ban could boost state revenue by 14 to 15%. Bihar generates an annual revenue of around Rs 65,000 crore.

The report highlighted severe implementation challenges, including systemic corruption, a drain on law enforcement, and public health risks associated with unregulated and dangerous spurious liquor. The NCAER study recommended that Bihar transition back to regulated sales with excise taxes. “Reinstating excise duty would free up significant enforcement resources while providing crucial tax revenue needed for priority sectors like education, health, infrastructure, and genuine job creation,” the report noted.