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.
Arth
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Crude Oil - The Opportunity Cost In The Pandemic
By Chanchal Ajager and Riya Sharma
“Managing one’s monetary expenses in pandemic becomes troublesome with soaring oil prices.”
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"Pandemic" scenarios make social life extremely stressful. In the second wave, the war was quite tricky. Overcoming these difficulties ended the second wave, and people's lives began to improve. But now, with unlocking India, life has been triggered by a sharp rise in oil prices.
BURNING FLAME
India is the world's third-largest consumer of crude oil, accounting for 4.6% of the world's share. Since unlocking, gasoline demand has increased substantially; adding fuel to the fire is the highest fuel tax. Undoubtedly, taxes soared when global crude prices dropped but did not roll back, and OPEC is currently reluctant to adjust prices because it seeks to cut supplies to maximize profits and offset losses caused by the pandemic. Back on the highway, the new gasoline prices have returned to the new normal within a week. For the public, the new rock bottom is 99-100 rupees, a 20% spike compared to 2020. People are struggling with unemployment, health problems, isolation, in short: an unbalanced lifestyle. Adding to it is the stormy inflation rate of around 6.3% in the markets.
On the other hand, there is no signal from the Government to reduce taxes on fuel. Besides, The Union Petroleum and natural gas minister Dharmendra Pradhan said, "They are constantly pushing OPEC and OPEC+ countries to reduce prices." He believes that the taxes collected are applied to various announced development and social plans that will compensate vulnerable groups affected by the pandemic. According to official sources, "the government has increased investment and capital expenditure by 34%". Therefore, The price increase is unlikely to decline in the future.
CAUSES OF COST OF ARM AND LEG AND ITS IMPACT
The general public might believe that the international crude oil market plays a vital role in their hefty pocket. But, by adjusting the balance of supply and demand in the international market, OPEC and OPEC+ countries play a minimalist role in India's pricing strategy. Since 2010 gasoline prices have been set by the government and revised every fortnight. The same has been true for diesel since 2017. Currently, according to the Hindustan Times, about 332 of the 730 districts have a model price of 100 rupees or higher per litre. The overall picture of such an increase is the inclusion of more than 50% tax on Indian crude oil which is shown below:
Bifurcating the tax components-
Due to this tax structure, India’s crude oil prices have recently risen and accelerated, making the pocket worse. Since India imports about 82% of its oil, this has a serious impact on its costs.
“As consumers are spending more on fuel, it is crowding out expenses on health. Our analysis of SBI card spends indicates that spend on non-discretionary health expenditure has been substantially reduced to accommodate increased expenditure on fuel," Chief Economic Advisor Ghosh said{ ECONOMICS TIMES}
As mentioned above, this means that the population is reducing health, utilities, and food costs due to the high opportunity cost of using gasoline. On the other hand, in the Covid era, the government chose a high crude oil tax as a source of income. In the end, this widened the gap between the various social classes.
Source: Hindustan Times
Further, oil rates have begun to rise faster; a 10% price increase would lead to a 0.50% increase in consumer price inflation. The price of oil per barrel in May 2021 jumped from US$49.8 per barrel in December 2020 to US$74.18 per barrel in June 2021, which means that higher tax breaks have overburdened the shoulders of soaring inflation and impaired the budget. Brings problems to financial households.
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TURN OVER A NEW LEAF
The disheartening public is seeking remedy in instances of the pandemic. With the general public returning to work, each class is worried about crude oil but is affording it on shrinking residing standards. There is certainly a want for the rest of the charges as it'd cause intense inflation trouble in the future too.
Some measures that people can take until rest comes are carpooling and public transportation. But a chief disadvantage to that is the hampering of social distancing norms. Henceforth earlier than the state of affairs becomes worse, the authorities must come into the picture and offer a remedy to the public. One of the principal degrees it could take is to include it below the "Goods and Services tax" list, which may also considerably lessen charges, but government expenditure comes into the scenario. Hence, some other opportunity that may be opted is alternative fuels for vehicles. For example- The recently inaugurated country's first Liquefied Natural Gas (LNG) facility plant at Nagpur. But implantation of such plants needs extra time and huge costs. So, the instant aims to revise the tax structure. For the time being, the authorities have to choose modified tax duties. Otherwise, this may make a contribution to accelerated inflation in the future.
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Riya Sharma
Lakshmibai College, Delhi University
Chanchal Ajager
Lakshmibai College, Delhi University
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