The lovely tale of Liquor
during Lockdown and before
At every stage, addiction is driven by one of the most powerful, mysterious, and
vital forces of human existence. What drives addiction is longing —
a longing not just of brain, belly, or loins but finally of the heart.
Cornelius Platinga
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The use of alcohol in India for drinking purposes dates back to somewhere between 3000 and 2000 BC. An alcoholic beverage called Sura which was distilled from the rice was popular at that time in India for common men to unwind at the end of a stressful day. . Yet the first mention of Alcohol appears in Rig Veda (1700BC). It mentions intoxicants like soma and prahamana. Although the soma plant might not exist today, it was famous for delivering a euphoric high. It was also recorded in the Samhita, the medical compendium of Sushruta that he who drinks soma will not age and will be impervious to fire, poison, or weapon attack. The sweet juice of Soma was also said to help establish a connection with the gods. Such was the popularity of alcohol. Initially used for medicinal purposes, with time it evolved and became the beverage that brought life to social gatherings, and eventually consuming alcohol has become a habit for many.
With such a rich history of not just humans but also of the gods,
what is a worldwide pandemic to stop anybody from drinking?
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According to a report released by the World Health Organisation (WHO) in 2018, an average Indian drinks approximately 5.7 liters of alcohol every year. In a population of casual and excessive drinkers, with the shutters of liquor stores down, it must have been extremely difficult for “certain” people to survive lockdown. In the first two phases of lockdown, the desperation had quadrupled prices of alcohol in the Grey Market of India. Also, According to Google Trends, online searches for “how to make alcohol at home” peaked in India during the fourth week of March, which was the same when the lockdown was announced. As a consequence, a few people died drinking home-brewed liquor. People committed suicide due to alcohol withdrawal syndrome. Owing to the worsening situation and to reboot the economy, some states decided to open licensed liquor stores in the third phase of the COVID-19 Pandemic lockdown in India. This decision was the worst best decision the state governments could take. The kilometer-long queues in front of liquor stores were evidence that a pandemic can turn your life upside down yet your relationship with alcohol cannot move an inch.
The love in the hearts of those who are addicted was explicit. We might have seen addiction, we might have witnessed desperation but what happened in the month of May was madness, not just in terms of the way people pounced but also in the way the government earned. According to a report by Hindustan Times, on the first day of the third phase of Lockdown, the Indian state of Uttar Pradesh recorded a sale of over Rs 100 Crore from liquor. On the second day of the reopening of Liquor stores, Karnataka reported sales of 197 crores in a single day which was the largest ever. Eventually, the prices of Liquor were hiked to 100% to discourage people from drinking.
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There was a special corona fee that was imposed in Delhi by Chief Minister Arvind Kejriwal. A 70% corona fee was imposed in Delhi, yet the sales did not drop. The entire situation was a disaster for the law enforcement officers, social distancing was easily abandoned and a basic code of conduct was happily violated. Despite the chaos created, the states continued to collect revenues. Home delivery of alcohol was allowed in Maharashtra and e-tokens were sold in Delhi.
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Demand for liquor is inelastic which means that
the sale of alcohol is not much responsive to change in prices.
In general, since alcohol policy is a state subject in India, revenue from Liquor is a cash cow for state governments. In 2018 and 2019, four states collectively collected about 20,000 crores in taxes from the sale of liquor. As much as the state earns from the sale of Liquor it is undoubtedly, a threat to the Economy. Consumption of alcohol has dire health consequences. When a person consumes an alcoholic beverage, there is a rise in BAC because of which there is a gradual and progressive loss of driving ability because of an increase in reaction time, overconfidence, degraded muscle coordination, impaired concentration, and decreased auditory and visual acuity. This is known as drunken driving. (V. M. Anantha Eashwar, 2020) Drunken driving is the third biggest cause of road accidents and over speeding in India. Road accidents are not it; alcoholism causes sleep problems, heart, and liver issues. Also, it is not about an individual’s life, it ruins the lives of all people concerned.
Addiction also causes economic loss. In 2000, Vivek Benegal and his team assessed 113 patients admitted to a special de-addiction service for alcohol dependence. They found that
the average individual earned a mean of ₹1,661 but
spent ₹1,938 per month on alcohol, incurring high debt.
They also found that 95% did not work for about 14 days in a month. They concluded that it led to a loss of ₹13,823 per person per year in terms of foregone productivity. A more recent study, Health Impact and Economic Burden of Alcohol Consumption in India, led by Gaurav Jyani, concluded that alcohol-attributable deaths would lead to a loss of 258 million life-years between 2011 and 2050. The study placed the economic burden on the health system at $48.11 billion, and the societal burden (including health costs, productivity loss, and so on) at $1,867 billion. “This amounts to an average loss of 1.45% of the gross domestic product (GDP) per year to the Indian economy,” the study said. (Mint, 2020)
Setho ka Gaon
With each passing day, the ‘curtain of separation’ weighs down on the women of Afghanistan, paving the way for tyranny to thrive.
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Nowadays, people are more interested in traveling to tourist destinations where sports events are to blame for drawing the most. It is the kind of entertainment based tourism, chosen by them, who are intently amused by the notion of exploring new places and customs. A mega sports-event can be viewed in two main aspects - first, with regard to its internal characteristics, its duration and its scale (i.e. number of participants and spectators, number of individual sessions and levels of organizational complexities); second, in respect to its external characteristics, which mainly include its media, tourism attractiveness and its impact on the host city. Olympic Games, world and continental cups of different sports disciplines (e.g. Football World Cup, Rugby World Cup, South American Football Cup) are considered as mega sport events, owing to their worldwide impact. The Olympic Games have always been considered one of the most significant mega-international sporting events. The increasing number of cities bidding to host the Olympics and the increasing funds invested in Olympic bids indicate that local leaders perceive the securing of such an event as an opportunity to improve the economic and social aspects of a city or region through the accumulated investment triggered by staging the games. As a result, in the course of the past two decades, there has been increased interest in the impact of the Olympics on the socio-economic and political life of the host city, region and country.
It is indeed necessary to comprehend that the direct income of a mega-sporting event, i.e. from sources such as ticket sales, television rights and sponsorship deals, does not necessarily contribute to the economic development of the host community, since such income usually covers the costs for organizing the event itself. The economic contribution of mega-sporting events is primarily thought of in terms of the possibilities they
provide for increasing the awareness of the city or region as a tourism destination and the knowledge concerning the potential for investment and commercial activity in the region. Therefore, they can attract more investment and visitors, and consequently create new jobs and contribute to the economic growth of the city or region. The economic impact of organizing mega sport events is elaborated below.
First, with regard to the issue of job creation, undoubtedly such events can generate a large number of jobs, not only for those directly associated with the organization of the event itself but also for those in the tourism and retail industry due to the increased volume of spectators/tourists, and in the construction industry, especially when the staging of the event requires major infrastructural development, such as in the case of Olympic Games. A fine factor that favors hosting mega-events in developing nations particularly, is the widespread availability of unemployed or underemployed labor which renders the opportunity cost of labor nearly zero. If a city has unutilized labor resources, the chances are increased that earnings generated by a mega-event will be earned by citizens of the city and stay within the city after the event is concluded. However, attention should be placed on the quality and duration of these jobs. Sporting events create service-related jobs which are often part-time or low-paying.
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Second, the experience of developing nations hosting sports events on a large scale may differ widely from that of a developed nation. The expenditure required for infrastructure is likely to be much higher in developing nations. The opportunity cost of capital may also be particularly high in developing nations. From an economic point of view, the cost of building a new stadium is not best described by the amount of money needed to build the facility but rather the value to society from the same amount of capital spent on the next best public project. The extent to which newly constructed sports facilities represent a good public investment depends not only on the immediate economic impact of these events but also on the usage of the facility after it. As sports and entertainment is a luxury good, the demand for sports infrastructure in the aftermath of the World Cup or the Olympics will likely be lower in developing nations than in developed countries.
Third, the economic contribution of such events might lie in a single impulse of increased demand during the period of the event, and evidently, it might lose its effect in a short period of time. It has been claimed that the economic growth generated from such events may actually make the life of low-income residents more difficult. Emphasis should be laid on the effects of a mega-sporting event on the house market and land values. It has been observed that the building of event-related infrastructure can involve housing relocation because of the compulsory purchase of land for clearance and building, and it can also lead to a rise in rents and house prices. Consequently, this can cause problems for people living on low incomes in these areas.
Fourth, when state and federal governments contribute to the staging of massive events like these, they inevitably make use of public money. Although one could claim that tax money can be used for projects upon which an elected government decides, when an event creates public debts, citizens are unfairly taxed to pay off these debts.
However, not every factor unique to developing countries works against the economic success of a mega-event. The relatively low wages of developing nations serve to lower operating and infrastructure costs. While low wages do reduce a host city’s ability to charge high prices to local residents or domestic visitors, lower wages do not limit a host’s ability to charge wealthy foreign visitors high prices for lodging, meals, and tickets. While it is often argued that specialized sports infrastructure does little to promote economic growth, mega-events often spur spending on non-sports related infrastructure that may provide for future economic development. On one side of the coin, a mega-event may prompt the otherwise reluctant public officials into needing general infrastructure improvements. On the other side of the coin, there is, of course, no reason to believe that general infrastructure improvements necessarily increase economic growth. Even infrastructure that is not directly sports related may go unused after the completion of the event.
To conclude, cities vigorously compete to host sports mega-events because they perceive that doing so will enhance their image and stimulate their economies. International sporting events require substantial expenditures on infrastructure, organization and security and critically depend, therefore, on public subsidization. When the socio-economic impact of a mega- sporting event is assessed, one should take into account a number of vital considerations. First, it is of great importance whether the host city manages to use the one-time economic impulse of such an event to change its structure in a way that will provide a self-sustaining process through, for example, permanent tourism, industrial settlements, regular follow-up events or even new economic relations with other regions or countries. Second, the extent of benefit for the overall economy depends on the economic situation of the city when event-related investments are realized. A phase of increased investment activity and increased consumption expenditure in line with an economic upswing or boom may weaken the positive economic benefits. Conversely, if event expenditures are made during an economic recession, these will be considerably strengthened. Cities and countries are to be well advised to more thoroughly evaluate booster promises of a financial windfall from hosting a sports mega-event such as the World Cup and Olympics before committing substantial public resources to such an event. Indeed, hosting these premier events may turn out to be more of a burden than an honor.
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References:
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Matheson, V., Baade, R. (2004). Mega-Sporting Events in Developing Nations: Playing the Way to Prosperity?. South African Journal of Economics, 72(5), pp.1084-1095
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Municipal Engineer 157 September 2004 Issue ME3 Pages 209–220 Paper 13568
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Pop, I., Kanovici, A., Ghic, G. and Andrei, M., 2016. The Economic Effects of the Mega Sport Events on Tourism in the BRICS Countries Case. Amfiteatru Economic, 18(Special Issue No. 10), pp. 960-975
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Overmyer, Michael P., "Economic Impact Analysis on Olympic Host-Cities" (2017). Honors Projects. 647.
Graphic study of London
Olympics 2012
Palak Gupta
Maharaja Agrasen, Delhi University
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