Alcohol sales cleared in Muslim-majority Lakshadweep. Here’s why the policy shifted

After 47 years of near-total prohibition, the Muslim-majority Union Territory of Lakshadweep will allow regulated alcohol sales through licensed outlets. The change follows the Union government’s repeal of the Lakshadweep Prohibition Regulation, 1979, which had kept the islands largely dry except for limited exemptions at government-run bars and select tourist resorts on Kavaratti and Bangaram.

The repeal was announced via a Gazette notification dated June 5, stating that it “shall come into force on such date as the Administrator may, by notification in the Official Gazette, appoint”.

In place of the earlier law, the Lakshadweep Excise Regulation, 2026 introduces a licensing regime to oversee the manufacture, possession, import, export, transport, purchase, sale, and consumption of liquor. The new framework also enables government-owned corporations and agencies to secure licences for importing and retailing alcohol.

Alcohol-related taxes, however, remain steep. Excise duty has been set at 400% for Indian Made Foreign Liquor (IMFL) and other foreign liquor, 200% for beer, and 80% for wine. By comparison, Delhi levies a 25% VAT on IMFL, beer, wine, and imported foreign liquor.

The new rules do not establish a free market for alcohol. The Administrator retains authority to regulate consumption, cap purchase and possession limits, and even reimpose prohibition across the entire territory or specific parts of it. Selling liquor to individuals under 21 years of age is strictly banned.

Lakshadweep comprises 36 islands, of which 10 are inhabited: Agatti, Amini, Andrott, Bitra, Chetlat, Kadmat, Kalpeni, Kavaratti, Kiltan, and Minicoy.

Both Indian and foreign tourists must obtain special permits to visit. Foreign visitors are currently limited to Agatti, Bangaram, and Kadmat islands.

Why was alcohol banned in lakshadweep?

Muslims account for around 97% of Lakshadweep’s population — the highest proportion among India’s states and union territories. A significant majority are also classified as Scheduled Tribes (ST). As per the 2011 Census, 61,120 out of 64,473 residents (approximately 95%) fall under the ST category.

The prohibition policy dates back to 1979 and was introduced in view of the islands’ predominantly Muslim population, as Islam forbids alcohol consumption. This placed Lakshadweep among the limited regions in India — alongside Gujarat, Bihar, and parts of the Northeast — where alcohol sales were banned.

Over the decades, successive administrations upheld the restriction, arguing it reflected local customs and social realities. Political groups and community bodies often resisted attempts to widen alcohol access, maintaining that prohibition aligned with prevailing religious and cultural norms.

That said, the ban was not entirely absolute. Limited exemptions allowed alcohol to be served to tourists and officials, particularly at resorts on Kavaratti and Bangaram, enabling authorities to balance visitor needs with the broader prohibition policy.

Hhy were alcohol rules changed in lakshadweep?

The primary driver behind the policy shift appears to be the Centre’s push to position Lakshadweep as a stronger tourism contender. Officials have argued that strict alcohol restrictions placed the islands at a disadvantage compared to other Indian Ocean destinations such as the Maldives, where liquor is served at resort properties.

In January 2024, Prime Minister Narendra Modi shared images from his visit to Lakshadweep, where he met residents, admired the scenic coastline, and went snorkelling — a move widely seen as promoting the islands as an alternative to overseas holiday spots.

According to data accessed by the India Today Group, tourist arrivals jumped by 47%, rising from 3,875 in 2020 to 68,328 in 2024. The most notable surge followed the Prime Minister’s January 2024 trip.

Efforts to relax prohibition began gaining traction after Praful Khoda Patel was appointed Administrator in 2020. In 2021, the administration proposed expanding alcohol service beyond Bangaram to tourist facilities on inhabited islands. The proposal faced strong resistance from local political parties, community groups, and residents, who warned of potential addiction issues, social disruption, and law-and-order challenges.

Despite opposition, the administration moved forward with plans for a regulated framework. In 2023, a draft excise regulation outlining a licensing system for alcohol sales and consumption was released. Earlier this year, in February, government-run bungalows on Chetlat and Bitra were designated as licensed premises permitted to serve liquor to authorised visitors under the previous prohibition setup.

Debate over the ban has frequently centred on religious considerations, given Islam’s clear prohibition of alcohol. However, alcohol remains legally available in Jammu and Kashmir, another Muslim-majority union territory, and several Muslim-majority nations — including the Maldives — allow sales in specific zones.

By repealing the 1979 regulation, the Centre appears to have determined that a tightly controlled alcohol policy better aligns with its broader strategy to expand tourism and hospitality infrastructure across the islands.