Liquor licence bids to fetch Rs 6,000 crore

There was a mad scramble for licences in the auction for liquor outlets held on Monday, with dealers bidding as high as Rs 5.21crore for a retail shop in Guntur district.

A gleeful government estimated that it will get more than Rs 6,000 crore towards licence fee from the auction.

At the same time, there are fears that retailers may go in for clandestine distribution of non-duty paid liquor to make up for the high licence fee. “The bid price quoted in several places is a shock for us too,” admitted a senior excise official.

Bids for 6,596 shops were opened on Monday and the term of new licence is two years. Officials fixed the upset price at 15 per cent higher than the actual licence fee paid last time.

However, in several places, the new fee jumped 150-200 per cent more than the upset price. In Nadikudi village of Guntur district, the retailers came forward to pay Rs 5.21 crore for a single outlet. In Vishakhapatnam, there was a bid for Rs4.72 crore.

Significantly, the licence fee offered was low in the capital city compared to several villages in Guntur, Warangal and Nalgonda districts.

The bid price in Rangasaipet in Warangal was Rs 3.45 crore, Moosapet in city outskirts Rs 3.5 crore, and Rs 2.91 crore in Bandlaguda.

Trade experts were also clueless about the astronomical bids. “Only dealers can explain the business plan,” said Mr Venkateswara Rao, president of the AP Wine Dealers Association.

A trader quoted Rs 1.5 crore for a shop in the busy locality of the city against the previous fee of Rs 65 lakh despite knowing that the previous licencee incurred a huge loss. All this has raised fears of the flow of non-duty paid liquor.