Karnataka’s small bar owners have an image problem: Politicians think they're very rich

“When elections were announced, I would desperately want to take a holiday outside India,” former liquor baron Vijay Mallya said in a recent podcast with Raj Shamani, recalling how he tried to avoid being accessible to politicians. “They felt the liquor business was a cash cow to fund their electoral aspirations, often unreasonable and impractical.”

Mallya may have fled India and lost his relevance in the alcohol trade, but his words ring true across Karnataka’s liquor business today. Politicians still see bar owners and distillers as walking ATMs, flush with cash and ready to fund grand schemes. The reality is different.

To understand why this misconception persists, it’s worth looking at Karnataka's unique relationship with alcohol. As Raghu Karnad noted in a 2012 story in The Caravan, “Karnataka is the exception. The power of its liquor lobby ensured that, uniquely among the South Indian states, it never attempted Prohibition.” The liquor industry has literally shaped Karnataka’s capital. Karnad writes that “Long before information technology made Bangalore famous, alcohol was the city’s defining industry.” This has made the state a powerhouse in India's alcohol industry, with Karnataka generating about Rs 35,530 crore in alcohol tax revenue during 2024-25, making it a vital pillar of state finances.