Punjab, known for its vibrant culture and agricultural prosperity, continues to grapple with significant challenges related to alcohol and drug consumption. This detailed analysis explores the current landscape of substance use in the state from 2023 through early 2025, with particular focus on the economic dimensions and per capita consumption patterns.
Punjab’s economy has historically been among India’s more prosperous states, though recent years have shown concerning trends in economic growth. In 2023-24, Punjab recorded a per capita income of approximately ₹1.85 lakh (₹185,000), which represented a modest increase of about 5.8% from the previous fiscal year. This placed Punjab as the 14th highest among Indian states in terms of per capita income. However, this growth rate has lagged behind faster-growing states like Karnataka, Gujarat, and Tamil Nadu, which have seen per capita income increases of 7-9% during the same period.
The rural-urban income divide in Punjab has become increasingly pronounced. Urban areas reported a per capita income of approximately ₹2.28 lakh in 2023-24, while rural areas recorded about ₹1.62 lakh. This disparity of roughly 41% has social implications for the consumption patterns of both alcohol and substances. The agricultural sector, which employs nearly 36% of Punjab’s workforce, has seen income stagnation, with average farmer income increasing by only 3.2% in real terms during 2023-24, significantly below the state’s overall economic growth rate.
Remittances from the Punjabi diaspora continue to play a substantial role in boosting household incomes in specific regions, particularly the Doaba region (Jalandhar, Hoshiarpur, Kapurthala, and Nawanshahr districts), where an estimated 11-13% of household income is derived from overseas remittances. These regions show distinct consumption patterns for premium alcoholic beverages compared to areas with lower remittance inflows. Income inequality within the state has widened, with the Gini coefficient increasing from 0.32 in 2022 to 0.35 in 2024. The top 10% of earners in Punjab now account for approximately 42% of the state’s total income, while the bottom 50% account for just 18%. This economic stratification correlates with distinct patterns in both the quality and quantity of alcohol consumed across different income brackets.
The financial burden of alcohol consumption varies significantly across income quintiles in Punjab. Recent household expenditure surveys indicate that families in the lowest income quintile who have regular drinkers spend approximately 15-18% of their household income on alcohol, creating significant economic strain. In contrast, households in the highest income quintile allocate only about 4-5% of their income to alcohol purchases, despite consuming more expensive products. In absolute terms, the average annual household expenditure on alcohol in 2023-24 was approximately ₹32,000 in households with at least one regular drinker. This represents a significant portion of the per capita income, particularly in lower-income households. The average per capita annual expenditure on alcohol across all Punjabi adults (including non-drinkers) was estimated at ₹9,800 in 2023-24, having risen from ₹8,900 in 2022-23, an increase that outpaced inflation. The affordability index for alcohol (measuring price relative to income) indicates that standard alcoholic beverages became marginally more affordable for middle and upper-income groups during 2023-24, while becoming less affordable for lower-income groups due to disproportionate income growth patterns. A standard bottle of popular whiskey required approximately 1.8% of monthly per capita income in 2024, compared to 2.0% in 2022.
Punjab’s per capita alcohol consumption reached approximately 7.9 liters of pure alcohol equivalent per adult (15+ years) in 2023-24, representing a 4.2% increase from the previous year. This consumption level is approximately 38% higher than the national average and places Punjab among the highest-consuming states in India. When analyzed by registered sales alone, per capita consumption appears lower at around 5.8 liters, indicating significant consumption of unrecorded or illicit alcohol. The distribution of this consumption is highly uneven across the population. Studies suggest that approximately 35-40% of adult males and 2-3% of adult females in Punjab consume alcohol regularly. Among those who drink, the average consumption is substantially higher, at approximately 19.7 liters of pure alcohol equivalent annually for male drinkers. Regional variations within Punjab are pronounced, with the Malwa region (including districts like Bathinda, Mansa, and Sangrur) showing the highest per capita consumption at approximately 9.1 liters, while the Majha region (including Amritsar and Gurdaspur) recorded about 7.2 liters per capita. These variations correlate with both economic factors and cultural attitudes toward drinking.
The alcohol industry constitutes a significant economic sector in Punjab. In the 2023-24 fiscal year, the state government earned approximately ₹7,000 crore from excise revenue, representing about 15-16% of the state’s own tax revenue. For 2024-25, the government projected excise collections of nearly ₹8,400 crore, indicating the growing economic importance of the sector despite health and social concerns. On a per capita basis, the Punjab government collected approximately ₹2,330 in alcohol-related taxes per adult resident in 2023-24, one of the highest rates in India. This revenue dependence has created policy tensions between public health objectives and fiscal considerations. The state’s 2024-25 excise policy aimed to increase minimum retail prices by 10-12% while simultaneously targeting higher overall revenue through increased sales volume, particularly in premium segments.
The alcohol production and distribution network provides significant direct employment to an estimated 75,000-80,000 people across the state. This includes approximately 12,000 workers in distilleries and breweries, 18,000 in distribution networks, and 45,000-50,000 in retail establishments. Indirect employment is estimated at an additional 150,000-175,000 individuals in related sectors such as agriculture (particularly for grain production), packaging, transportation, and hospitality.
As Punjab’s per capita income has evolved, alcohol consumption patterns have shown notable shifts. Among higher-income groups (top 20% by income), consumption has increasingly moved toward premium products, with imported spirits showing a growth of 23% in 2023-24 and craft beers expanding by 35% in urban centers like Chandigarh, Ludhiana, and Amritsar.
Middle-income consumers (40-80 percentile by income) have maintained relatively stable consumption volumes but have demonstrated brand mobility, with increasing preference for established national brands over local products. For this segment, alcohol expenditure as a percentage of income has remained relatively stable at 6-8% for households with regular drinkers.
Lower-income groups have faced increasing pressure from rising alcohol prices relative to income growth. Field studies indicate some substitution toward potentially harmful alternatives, including illicit liquor, which has been estimated to account for 18-22% of total alcohol consumption in the state by volume. Public health officials have recorded approximately 85 deaths related to spurious liquor consumption in 2023, highlighting the dangerous consequences of this economic pressure.
The drug abuse crisis in Punjab continues to demonstrate strong correlations with economic conditions. Districts with lower per capita income and higher unemployment rates, particularly in border areas, show higher prevalence of substance use disorders. The economic cost of addiction is substantial, with affected households spending an estimated ₹1,500-2,200 per day on opioids like heroin in 2023-24, an amount that exceeds the daily per capita income of Punjab by several times. A 2023 survey across 15 districts found that approximately 65% of people seeking treatment for substance use disorders reported significant debt accumulation due to their addiction, with an average debt of ₹3.2 lakh per affected individual. This economic burden exacerbates poverty cycles and contributes to asset liquidation, particularly land sales in rural areas. The state government allocated approximately ₹520 crore for drug prevention, treatment, and rehabilitation programs in the 2023-24 budget, representing about ₹173 per capita. However, public health experts have argued this remains insufficient given the scale of the problem, which continues to have profound implications for productivity and economic development in the state.
As Punjab moves through 2025, economic projections suggest modest growth in per capita income of approximately 6-7% for the fiscal year. However, persistent structural issues in the economy, including agricultural stagnation and limited industrial growth, may continue to influence substance use patterns. Economic anxiety and limited opportunity horizons, particularly among youth, are cited by addiction specialists as contributing factors to initiation of substance use. Recent policy innovations include a proposed “addiction impact fee” on alcohol sales to fund treatment programs, which would add an estimated ₹200-250 crore annually to rehabilitation efforts. Additionally, pilot programs linking economic rehabilitation with addiction treatment have shown promising results, with approximately 3,800 recovered individuals placed in stable employment through state-supported programs in 2023-24.
The complex relationship between Punjab’s economic trajectory and its substance use challenges demands integrated policy approaches that address both demand and supply factors. Economic development strategies that create meaningful employment opportunities, particularly for youth, may prove as important as traditional enforcement and treatment approaches in addressing the state’s ongoing challenges with alcohol and drug consumption.