Economists urge Bihar to scrap liquor ban and boost development funding
A new NCAER study recommends ending Bihar's alcohol prohibition to raise tax revenue and fund development, noting the ban has not curbed violence against women.
Economists from NCAER presented a paper suggesting that Bihar abandon its stringent prohibition on alcohol sales and consumption. Led by Ratna Sahay, the authors estimate that ending the ban could boost the state's tax revenue by about 14-15% and lower spending on enforcement. Their analysis indicates that the ban has not produced a measurable decline in crimes against women and has coincided with a surge in illicit liquor and drug markets.
The study also urges the central government to increase transfers for flood-control projects and other development needs. While crediting Chief Minister Nitish Kumar for restoring law and order, the authors note Bihar still trails other states in revenue generation and carries a debt burden of 39% of its GDP. They propose higher capital expenditure, reduced subsidies, and additional central funding to address gaps in education, health, governance, and gender violence.
Why it matters
Lifting the ban could raise Bihar's revenues and fund critical infrastructure, affecting millions of residents.
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