Starting April 1, 2025, Madhya Pradesh (MP) will introduce ‘Low Alcoholic Beverage Bars’ while simultaneously enforcing a complete liquor ban in 19 designated locations, including 17 holy cities. This move, part of the state’s revised excise policy, aims to promote low-ABV (Alcohol by Volume) alternatives while respecting cultural and religious sentiments. The new policy will allow only beer, wine, and ready-to-drink beverages with a maximum of 10% ABV in these bars, strictly prohibiting spirits like whiskey, rum, vodka, and gin.
But what does this shift mean for the state’s economy, alcohol consumption habits, and overall regulation? Let’s break it down.
Why the Change?
The MP government, led by Chief Minister Mohan Yadav, has taken this step to regulate alcohol consumption while maintaining the sanctity of religious sites. The prohibition will apply to key holy cities such as:
- Ujjain
- Omkareshwar
- Maheshwar
- Chitrakoot
- Orchha
- Maihar
- Mandla
- Amarkantak
- And other significant pilgrimage destinations
Unlike complete prohibition states like Bihar and Gujarat, MP has opted for a selective ban, restricting alcohol sales in religious hubs while allowing moderate consumption in designated venues.
Impact of the Policy
Closure of Liquor Shops in Holy Cities
Liquor sales will be completely prohibited in 19 locations, leading to the shutdown of 47 composite liquor shops that previously sold both country liquor and Indian-made foreign liquor.
Revenue Loss for the State
MP is expected to incur an excise revenue loss of approximately ₹450 crore due to the restrictions. However, the state anticipates offsetting some of this loss through increased licensing and taxation on low-ABV bars.
Increase in Low-Alcohol Bars
With the ban on hard liquor, the state will see a rise in bars that exclusively serve beer, wine, and pre-mixed cocktails with an ABV of 10% or less. This aligns with global trends where consumers are shifting towards lower-alcohol beverages due to health concerns and lifestyle preferences.
Personal Consumption Still Allowed
Unlike states with complete prohibition, MP’s policy does not impose penalties for personal possession. Individuals can still bring liquor from outside the restricted areas for personal consumption, reducing the risk of illegal bootlegging.
The Global Trend Towards Low-ABV Drinks
Madhya Pradesh’s move reflects a broader global shift towards reduced alcohol consumption and increased interest in low- and no-alcohol beverages. Studies show that:
- In the U.S., Gen Z and millennials are consuming less alcohol than previous generations, with over 50% opting for non-alcoholic drinks occasionally.
- Sober bars and alcohol-free pubs have emerged in cities like Dublin and New York, catering to younger demographics who prefer socializing without heavy drinking.
- The low-ABV market is expanding rapidly, with beer and wine brands introducing lighter options to meet changing consumer preferences.
What’s Next for MP’s Liquor Policy?
Madhya Pradesh’s approach to alcohol regulation is a unique blend of restriction and moderation. By banning liquor sales in religious areas while encouraging low-ABV consumption elsewhere, the state hopes to strike a balance between cultural sensitivity and economic stability.
However, questions remain:
- Will the revenue loss from liquor shop closures significantly impact the state’s economy?
- Will low-ABV bars be able to sustain consumer demand in MP?
- Could this selective ban encourage illegal alcohol trade in restricted areas?
Only time will tell if MP’s hybrid approach proves successful or if further adjustments will be needed.
Summing Up
Madhya Pradesh’s new excise policy marks a significant shift in alcohol regulation, embracing global trends while preserving religious traditions. By promoting lower-ABV alternatives, the state aims to modernize drinking habits while maintaining control over high-alcohol consumption in sacred locations.
As the policy unfolds, it will be interesting to see how businesses, consumers, and religious institutions respond to this new liquor landscape in MP.
