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National Highway Liquor Ban In India; 100,000 shops closed; Rs. Rs 2,00,0000 crore loss to exchequer: Report says

April 11, 2017

LIQUORbanThe Federation of Hotel & Restaurant Associations of India (FHRAI) is exploring legal remedies with regards to the recent Supreme Court Order, shutting down from 1st April 2017, the sale of liquor at establishments which fall within a 500 metres range of State and National Highways.

Dilip C Datwani, FHRAI said: “Rs 2,00,000 crore loss to the exchequer and closure of more than 1 lakh establishments is not a small thing. We would not have minded being sacrificed if the ban were to yield results. But the reality is that all the job losses and other damages would be wasted. The object sought would not be achieved”.

“Total consolidated loss to both States and to the industry will be around 2 lakh 20,000 crores. The entire MICE industry including weddings, corporate events will be negatively affected” said Garish Oberoi a member of FHRAI.

“There has been an unprecedented blanket ban on all national highways across the country without seeing the practical aspect of the topography and terrain of the cities, in the process having affected hotels and restaurants, who have invested crores of rupees towards the development of the tourism industry in the country. For example, Darjeeling, which falls on NH 55, has hotels stretched over 77 kms from the very base of the town of Siliguri that are directly affected” added TS Walia from FHRAI.

‘The judgement has effected those establishments that operated legally and we are not takeaways and serve for consumption in premises only. Many entrepreneurs who have taken loans will be placed at a disadvantage. It will make their properties non-preforming further ‘continued S M Shervani, FHRAI.

While agreeing that the judgment may “in spirit” be good, it does not cohesively look at other related issues Datwani said “Statistics prove that there is a correlation between drunk driving and enforcement, but not between drunk driving and existence of hotels or restaurants.

Otherwise, there would be no drunk driving cases or resulting accidents in Bihar and Gujarat where we have total prohibition and yet there are innumerable accidents due to drunk driving. No country has ever banned hotels and restaurants to curb drunk driving.”

Sudesh Kumar Poddar president of the Hotels and Restaurant Association of Eastern India said establishments with significantly reduced business will result in distressed financial assets and may lead to a large scale NPA situation for the banking and financial system and may severely impact the investment climate in tourism and hospitality

The liquor ban on highways has affected at least 1,000 star hotels in Maharashtra including the VIP Lounge at the domestic airport. Maharashtra is expected to lose an estimated yearly revenue of Rs. 7,000 crore according to estimates from FHRAI.


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