Bihar liquor ban: How will Nitish Kumar's decision impact state's financial health

Patna: Bihar is all set to go dry from April 1, 2016!

In a bold move, Bihar CM Nitish Kumar on Thursday made the official announcement of banning liqour ​(a part of his poll promise) in the state to mark Prohibition Day in Patna.

The decision has been welcomed by people from almost all walks of life. But, the million dollar question is - how will it impact Bihar's financial health?

Bihar earns a revenue of nearly Rs 4000 crore annually from liquor sale.

According to a data, the revenue collection of excise department in Bihar registered a more than 10-fold jump, from Rs 319 crore in 2005-06 to Rs 3,650 crore in 2014-15.

In 2007, the state excise department went into an overdrive in 2007 following a new policy and started issuing licences for marketing liquor across the state. 

Also, soon after the official announcent by Nitish Kumar, liquor stocks such as United Spirits and Radico Khaitan saw selloff. The ban is expected to impact sales of spirits makers as Bihar is the country's third-most populous state.

So, it is yet to be seen how the Nitish Kumar government plans to make up for this loss of revenue.

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