NEW DELHI: Bihar should withdraw its prohibition on alcohol as the ban has failed to reduce crimes against women and has been accompanied by a rise in illicit liquor and alternative intoxicants, according to a research paper by economic think tank National Council of Applied Economic Research (NCAER).The paper, titled ‘Macro Perspective of Bihar’s Development Achievements, Unfinished Agenda, and the Way Forward’, also said restoring liquor excise duty to pre-ban levels could increase the state’s own revenues by 14-15 per cent while reducing expenditure on enforcement and anti-smuggling operations.Prepared by a team of economists led by Ratna Sahay and presented at the India Policy Forum, the paper examined the economic and social impact of Bihar’s prohibition, introduced in April 2016.
Ban failed to reduce crimes against women, says paper
The paper said the primary reasons for introducing prohibition were the belief that alcohol consumption contributed significantly to domestic violence and that households would redirect money previously spent on alcohol towards more productive uses.Women’s groups and activists had also strongly backed the ban, arguing that prohibition would reduce alcohol-related abuse.However, the NCAER researchers said available data now allows an assessment of whether those objectives were achieved.“We now have sufficient data and information to assess if the ban was effective. Reported crimes against women in Bihar have not declined following the introduction of prohibition. Instead, total reported crimes against women increased over the post-2016 period,” the paper said.According to the study, the available evidence does not show a broad-based reduction in crimes against women after prohibition. Instead, it said the ban coincided with concerns over the expansion of illicit liquor networks, enforcement difficulties and corruption.The paper also pointed to increased use of alternative intoxicants, including illicit drugs.“In tandem, there was a significant rise in illegal liquor trade leading to higher alcohol consumption, increased crime and corruption, and an increase in the use of alternative additive substances, such as illicit drugs,” it said.
Prohibition has also hit state revenues
The NCAER paper said Bihar suffered significant fiscal consequences after the ban. Before prohibition, excise duty on alcohol accounted for about 14 per cent of the state’s own revenues in the three years preceding the ban.At the same time, the government incurred higher expenditure on monitoring, enforcement and anti-smuggling operations, which the paper said added to fiscal pressures.The researchers argued that reinstating liquor excise duty at historical levels could help restore the contribution of the tax to around 14 per cent of state revenues.The paper concluded that the prohibition had not achieved its intended objectives and had instead coincided with higher reported crimes against women, loss of state revenue and increased enforcement expenditure.
Education, health and jobs among Bihar’s priorities
Beyond prohibition, the paper identified six interconnected areas that it said should form the core of Bihar’s development strategy: education, health, governance and law and order, flood mitigation, private-sector development and women’s empowerment.It said reforms in these areas were necessary to improve productivity, accelerate structural transformation and create better-quality jobs for Bihar’s young population.The study also examined the state’s public debt and fiscal sustainability, and assessed the financing required for different reform scenarios. It called for a combination of stronger own-revenue mobilisation, more efficient public spending, additional central government support and, where necessary, further borrowing.
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The paper noted that improvements in law and order had played an important role in Bihar’s economic recovery after 2005, when the state government under Nitish Kumar placed greater emphasis on policing, criminal prosecution, judicial reforms and administrative accountability.It also highlighted Bihar’s significance for India’s broader development goals, noting that the state is the country’s second most populous and remains its poorest.Bihar’s population is estimated at 13.2 crore in 2026, according to the paper, accounting for more than 9 per cent of India’s population. It noted that the state’s population is larger than that of all but 10 sovereign countries.
