Wave Group's liquor licence in UP renewed

The Uttar Pradesh government has renewed Wave Group's wholesale liquor licence. The group was promoted by liquor baron Ponty Chadha, who was killed last year in a shootout.

The renewal of the licence, earlier valid till March 31, was cleared by the UP government last evening.

The group's licence to run liquor shops was valid for two years. After Chadha was killed in a shootout in Delhi in November 2012, rival contractors had demanded the government's liquor policy be changed. They said an earlier practice of a lottery for the shops (by region) should be followed. The lottery, which would have 20-25 wholesalers in the state, would do away with the near dominance of one group in the state.

The current liquor vend policy was formulated when Mayawati was the state chief minister. Mayawati was known to have close ties with the Chadhas. Those in the know of politics in the state say the Wave group has been able to build bridges with the Akhilesh Yadav-led government, too.

A Wave spokesperson declined to comment on the issue.

The Uttar Pradesh government has raked in substantial funds by giving the rights of distribution of liquor predominantly to the Wave Group (for foreign and Indian liquor). The state has also seen a fall in liquor smuggling. In 2011-12, it garnered Rs 8,139 crore as revenue from liquor vends. For this financial year, the excise revenue is expected to exceed Rs 9,766 crore, based on trends seen in the previous three years. With growth of 20 per cent a year, the liquor industry is a vital source of revenue for the state.

The consolidated annual liquor business in Uttar Pradesh (foreign and country-made liquor), is estimated at Rs 14,000 crore. Barring some districts such as Lucknow, Allahabad and Varanasi, where the segment is dominated by the Deep Group, the Wave Group rules the roost in the state.

There are about 17,000 retail liquor shops in the state. Wave Group companies supply to 40 per cent of these. These companies exclusively take the delivery of liquor from 54 distilleries for retailing.

The state had announced a rise in the excise duty on beer and liquor by 15-20 per cent. Licence fees of retail shops would also be increased. The state would also allow the sale of premium liquor in malls, albeit for a higher licence fee.