An estimated 35,000 restaurants and bars faced closure or downsising in Western region, including 13,655 bars and liquor shops in Maharashtra, following the Supreme Court's order upholding the ban on selling or serving of liquor along the highways (NH) and state highways (SH) with effect from April 1.
Giving details of the unprecedented threat faced by the Indian food service industry in the wake of the apex court's refusal to revisit its order banning liquor vendors within 500 metres of the national and state highways, the Hotel And Restaurant Association of Western India (HRAWI), an apex body of bars and restaurants said on Saturday that the ban would spell doom for the industry when the SC's order was implemented.
"An estimated 35,000 restaurants and bars could face closure or downsizing in the Western region alone. This decision may lead to job losses for more than a million employees across India. A business is started after careful consideration of existing regulations, limitations, opportunities and potential sales. Capital intensive businesses like hotels and restaurants work on wafer thin margins. An abrupt cancellation of sale of a core product will create havoc. Many of the hotels are in heavy debt and they may not be able to sustain this change of regulation," former President of the Federation of Hotel and Restaurant Associations of India Dilip Datwani said.
In December 2016, the Supreme Court had ordered the closure of all liquor shops along the national and state highways if they were within 500 metres from the edge of the highway. It had also directed the Governments to "cease and desist" from issuing excise licenses after March 31. The apex court on March 31 upheld the earlier order, but said that subsisting licenses could operate till September 30.
"Maharashtra alone has 13655 bars and shops, of which about 290 bars will be hit only in Mumbai, while in Mumbai Metropolitan Region 2000 and in the State of Maharashtra 9925 are at a risk of losing business," FHRAI's former president Kamlesh Barot said.
Datwani said that the Indian food service industry, standing at Rs 4,08,000 thousand crore, would lose close to about Rs. 2,00,000 crore on account of the SC verdict.
"Excise revenue from alcohol is Rs. 12,000 crore per annum which would also become half. The travel and tourism sector contributes 7 per cent of India's GDP, and generates 37.4 million jobs, but due to this liquor ban, at least 5 per or 1 million jobs will be lost," Datwani said.
"Only licensed bars will stop serving liquor. Unlicensed bars that operate illegally across the national highway may continue liquor service. Travellers who are really keen on consuming alcohol will find ways and means to procure it, and these steps may not turn out to be sufficient deterrents. Drunken driving is a problem across the world and most countries have evolved more efficient and less harsher measures to counter the menace," former HRAWI president Bharat Malkani said.