Andhra Pradesh Makes Rs 600 Crore Net Profit Selling New Bar Licenses

The sale of bar licences under a new policy evolved by the Andhra Pradesh government has come as a windfall as the net revenue touched a record Rs 600 crore in just the last two days.

The state government earned Rs 19,500 crore from sale of liquor in 2021-22, an increase of over Rs 3,000 crore compared to the previous year. The government escrowed the Excise revenue and raised a loan of Rs 8,300 crore in the name of welfare schemes.

This, in addition to the Rs 16,000 crore raised by the AP State Development Corporation by escrowing the income from additional retail Excise tax the previous year. For the first time, the Excise Department sold the bar licences through e-auction after fixing an upset price (reserve price) for each outlet, based on the location.

Under the previous policy, the government got Rs 289.14 crore through sale of licences but now it went up to Rs 597.35 crore, marking a 106 per cent rise, sources in the Excise Department told PTI.

The new bar licences were sold at a time when the Jagan Mohan Reddy regime went into a denial mode on its avowed liquor policy claiming it "never promised total Prohibition." "Our (election) manifesto did not promise total prohibition. It only spoke of raising the rates steeper," Industries Minister Gudivada Amarnath claimed.

However, he was soon trolled on social media, where a purported cutting from the YSRC manifesto - which it claims to be the Bhagavad Gita, Quran and the Bible - was posted to remind everyone of the ruling party's promise to implement the dry regime.

Excise Department officials noted that some cartelisation over bids being placed marginally above the reserve price dent a blow to expected revenue in major cities like Visakhapatnam and Vijayawada. Interestingly, in many towns perceived to be 'small', the bids rocketed to unprecedented levels, crossing the Rs one-crore mark and fetching a bounty to the department.

"But for the cartels, the e-auction could have netted us at least Rs 100 crore more. In many places, only single bids were placed while in major cities the cartels ensured the bid amount remained just around the upset price," a top official of the Excise Department pointed out.

In Kakinada city, for instance, 18 applications were filed for 11 bars but during the auction only 11 bids were offered.

In Vijayawada, the upset price was Rs 50 lakh per bar but the maximum bid amount in the city was just Rs 52 lakh.

In Tadigadapa municipality just outside Vijayawada city, a trader secured the bar licence for Rs 97 lakh, whereas the upset price here was Rs 35 lakh.

In a town like Darsi in Prakasam district, the licence bid was for Rs 1.47 crore against the upset price of a mere Rs 15 lakh. Same was the case in Markapuram, where heavy competition resulted in a bid of Rs 1.47 crore against the upset price of Rs 35 lakh.

In all, more than 10 bar licences were grabbed for record sums in excess of Rs one crore each, mostly in the Rayalaseema region of the State, Excise Department sources said. Of the 840 bar licenses put up for auction, 817 were sold out in two days. "We will conduct a fresh auction for the remaining bars as well," the sources added.

(This story has not been edited by NDTV staff and is auto-generated from a syndicated feed.)