UP eyes 600 new liquor shops in outskirts of key cities

Lucknow: Around 600 new retail liquor vends could come up in UP in the coming months. The excise department is carrying out an exercise to find out the estimated population that shifted to the outskirts of key cities within the past one year before finalising the exact number of new shops.

The objective is to cover the recently established residential pockets and colonies by providing new outlets through which the demand for foreign liquor, beer and other kinds of alcoholic beverages could be met while generating increased revenue during the 2026-27 financial year. Several retailers have opted to pull out of the liquor business from Mar 31, citing lack of financial viability.

Out of the 27,308 liquor shops that catered to liquor patrons across the state, 421 (model shop, country liquor shop and composite shop) did not find takers even after conducting four rounds of lottery draw. Officials said that in the fifth round, the original licence fees that were paid during the 2025-26 financial year to run these shops could be slashed by 20% to make their operations viable. “The final call is yet to be taken,” said an officer. Available at steep licence fees within the city limits, scores of entrepreneurs exited from the model shops instead of agreeing to pay up the hefty fees.

In addition to the leftover shops that could not be renewed or settled so far, the department is contemplating introducing about 600 new liquor vends. According to the provisions of the excise policy, the excise commissioner has the authority to allow more shops to come up if the need is felt to cover mushrooming residential localities.

“The policy allows the excise commissioner to allow up to 3% increase compared to the total retail shop number in the previous financial year in a district,” said the officer. Establishing additional retail shops would help the department cover the losses it would incur to allow existing shops to come up at rationalised licence fees. It is estimated that through licence fees and processing fees the department was able to rake in Rs 4,000-5,000 crore during the last fiscal year.

Overall, the department managed to achieve annual revenue of Rs 57,722 crore by levying duty, fees and other charges over the liquor trade in 2025-26. Achieving a saturation point, the excise department has been trying to create additional revenue streams through new measures.