By Arjun Talwar

‘Chaar Botal Vodka’ was another successful song in the list of chartbusters produced by the Indian Film Industry. Like various other songs which released in the recent times  or even like its old counterparts from the 1900’s, this song glorified alcohol and went on to top the charts. As the alcohol culture dwells its way in the society, a need for more of such songs, films and advertisements is realized by the profit seeking agencies. Dependency on alcohol is picturized as necessary for living a cool, tension-free and elite life. Whether drinking alcohol makes you cool or not is a totally different debate, the point of consideration here is that drinking liquor has a number of known economic implications which are harmful both for the individual and the nation. We are not just talking about regular alcoholics but any amount of alcohol which makes you tipsy can have its impacts.

Alcohol generally slows down the mental activity which further has its own consequences. The economic costs of alcohol consumption depends upon various factors most of which arise from hampering of brain activity. Hence various direct and indirect costs exist. Direct costs include costs of health care, road accidents, crime related costs, cost of alcohol itself, cost for counseling and rehabilitation etc. Indirect costs include absenteeism from work, decrease in productivity and income levels due to alcohol, loss due to mortality as well as decrease in productivity due to social disruptions which are a consequence of drinking.

Regular drinkers are often seen to be unemployed or they work with loss of productivity. Especially men from the economically weaker classes, who indulge in the habit of drinking, are found to live in a state of privation. Premature mortality is also observed as a result of alcohol consumption which takes away indiscriminate amount of wealth from the nation. Economic costs of loss of productivity and mortality are not very easy to calculate, but unemployment can be seen as a direct consequence.

In India, about 40% of alcohol is branded whereas rest is local made Country spirit. Such beverages have serious repercussions to health. The state governments make huge earnings by taxation of liquor but they end up spending even greater amount of money towards the health care sector. According to a report, for every rupee that the government of Andhra Pradesh earns by collecting taxes from liquor, it spends Rs 1.6 on hospital and rehab facilities for the alcoholics.

The effects of alcohol are not restricted to the drinker itself. A large number of traffic accidents can be traced back to drunk drivers. Loss of life and property due to drunk driving has increased itself manifold in recent times. According to ‘Global Status Report on Alcohol and Health 2014’ by World Health Organization (WHO), the per capita alcohol consumption in India has seen a steep rise since 2005. Hence a greater number of road accidents occur due to alcohol. Also, an alcoholic adversely affects his family members. Cases of domestic violence not only restrict the women but create a negative psychology among the family members which further imply loss of productivity for the whole family.

If we look at some numeric data then all the above arguments make quite sense. According to WHO report 2004, work-related alcohol problems have been estimated to cost Rs 70 to 80 million. The cost resulting from tobacco-related cancer deaths has been estimated to be about Rs 308 billion. Also according to some individual reports the unit cost of death and injuries has been estimated as follows- urban deaths: Rs 28 863; rural deaths: Rs 6764; urban serious injury: Rs 30 275; rural serious injury: Rs 17 240. The cost of managing a patient with brain injury in a tertiary health care institution has been estimated to be about Rs 1506 per hour.

In a 1997 study comparing two groups of families within the same community in Delhi, India (Group A having at least one adult consuming alcoholic drinks at least three times per week in the last month and Group B having no adult consuming more than one drink in the last month), it was found that Group A, on an average, spent almost 14 times more on alcohol per month compared with Group B. A larger proportion of families in Group A had significant debt compared with Group B. The implications of this are towards fewer financial resources for food and education of children and fewer resources for purchasing daily living consumables. The more heavily drinking Group A was more likely to report major illnesses or injuries during the past one year and was more likely to require medical treatment.

These statistics and reports are of grave importance. They hint that dependence on alcohol can deflate our developing economy. So the next time you enjoy ‘Chaar Botal Vodka’ on your iPod or on a local made hand held radio transmitter, remember the serious consequences of alcohol which effects all, rich and poor, alcohol consumers and their associates, and the nation as a whole. A sense of wisdom must prevail in the society so as to decrease the negative economic impacts of alcohol. We reside in an era where a lot of concentration is given to revive the stagnant economy but we bluntly miss factors like excessive use of alcohol which are constantly pulling us back. Hence, the government must take necessary actions to restrict promotion or sales of liquor if it hinders the productivity of the nation.

Arjun is currently pursuing Economics (H) from Moti Lal Nehru College, Delhi University. He has a habit to discuss politics and current affairs over the dining table (like most Indians!) He is a loquacious speaker yet an avid listener who loves to chill with friends. He is a debater at heart and desires of travelling long distances. Watching movies and cricket is what he craves for in his free time. He can be contacted at

Posted by The Indian Economist | For the Curious Mind