PANDEMONIUM, predictably, was the fall-out in the assembly when Andhra Pradesh Chief Minister N. Chandrababu Naidu decided to do away with the state’s ‘dry law’. High-voltage drama prevailed in the Opposition benches. NTR’s widow and TDP faction leader, Lakshmi Parvati, broke down. Fourteen members of the CPM—the ruling TDP’s closest ally—were suspended. Walkouts were staged and marshals got into their act against trouble-makers. But the Bill—AP Prohibition Act, 1997—was passed. While 212 favoured it, the lone member left in the House to express his token protest was the Majlis Bachao Tehrik (MBT) leader, Mohammud Ama-nullah Khan. And Governor Krishan Kant consequently gave his assent to it.
As finance minister in N.T. Rama Rao’s government, Naidu had argued along his leader’s lines that total prohibition was a ‘social commitment’ and could not be measured in terms of revenue loss. When he took over the reins from NTR after the August 1995 crisis in the ruling TDP, Naidu had declared total prohibition, even withdrawing the health permits. He also amended the AP Prohibition Act, 1995, introduced by his predecessor in January that year.
Now Naidu is forced to backtrack as the state exchequer is deep in the red. The budgetary deficit this year is Rs 960 crore, 32.20 per cent of the annual budget outlay of Rs 2,980 crore, and the Reserve Bank has twice threatened to withdraw the overdraft facility. Prohibition Minister Nettem Raghuram admitted that his government had failed to implement the much-trumpeted policy effectively. "The government made earnest efforts and took a series of steps to enforce prohibition. Despite its best efforts, prohibition-related offences, particularly illicit distillation and smuggling, have been steadily increasing," he said.
More than a dozen TDP legislators, including the late Yerra Satyam from Mahabubnagar district, have been accused of patronising bootleggers in their respective constituencies. Complains P. Janardhana Reddy, Congress Legislature Party leader: "Naidu has shown no interest in disciplining his legislators. Instead, he allowed them a free hand. Even his brother, N. Ramamurthy Naidu, indulged in bootlegging to amass wealth in his native Chittoor district." Naidu, conceding the Opposition demand, has now ordered a probe against his brother for allegedly patronising smuggling of liquor. Says pro-prohibitionist Malladi Subbamma: "The government lacked sincerity in implementing total prohibition. This was evident from the reluctance of the authorities to book the ruling partymen."
The political interest in total prohibition had come about after women voters held an epoch-making agitation in Dubagunta, Nellore, during the regime of the then chief minister Kotla Vijayabhaskara Reddy, demanding a ban on all liquor. In a bid to bounce back to power, NTR incorporated the demand of the women—a stronghold of his party’s votebank—in the TDP election manifesto. And consequently secured a massive mandate—224 of the 294 seats in the assembly. The expected revenue loss from ‘total prohibition’ was, at the time, put at a staggering Rs 600-700 crore.
The resultant financial crisis was not eased despite Naidu increasing taxes to the tune of Rs 2,500 crore, and raising the cost of subsidised rice (a vote-catching scheme that was very dear to NTR) to Rs 3.50. Then came the amendment to the Prohibition Act, allowing sale of Indian Made Foreign Liquor, to bring in Rs 1,000 crore as revenue to the exchequer annually. The modalities of implementing the new AP Prohibition Act, worked out by a Cabinet sub-committee, is based on the Delhi model. Some aspects:
- Retaining the AP Beverages Corporation as the distributor of IMFL brands—as it was during the Congress rule immediately after the sale of arrack was banned.
- Restricting retail outlets to only one in each of the 1,100-odd mandals.
- Allotting retail outlets through auction.
- Giving licenses to only five star hotels and clubs run on a no-profit-no-loss basis.
- Fixing the time of sale at retail outlets.
Meanwhile, the Opposition continues to demand Naidu’s scalp. Says Y.S. Rajasekhara Reddy, a senior Congress MP: "Naidu has no moral right to continue in office, he has watered down all his party’s electoral promises. Naidu has betrayed the people’s confidence." And in Nellore, the birth place of the women’s anti-arrack movement, there are reports of growing unrest.
To justify his government’s decision, Naidu may have to score a point by taking up development activities such as power generation and establishing law and order in Naxalite areas. Despite accusations of deviating from NTR’s ideals, this could turn out to be Naidu’s chance to rid himself of the politics of populism and finally get on to the path of hard ground realities.