The Centre has officially repealed the 47-year-old prohibition law in Lakshadweep and introduced a new regulatory framework permitting the sale of alcoholic beverages through licensed outlets across the Union Territory.
The change comes through the implementation of the Lakshadweep Excise Regulation, 2026, which was notified in the official gazette on June 5. The new regulation replaces the Lakshadweep Prohibition Regulation, 1979, ending nearly five decades of alcohol prohibition in the island territory.
Under the revised framework, the production, import, export, transportation, sale, and consumption of alcoholic beverages will be governed through a licensing system. Government-owned corporations and agencies will also be eligible to obtain licences for retail liquor sales.
Officials stated that while the new policy allows regulated alcohol sales, it includes strict safeguards to monitor and control consumption. The regulation prohibits the sale of liquor to individuals below 21 years of age and empowers the Lakshadweep Administration to impose purchase limits, regulate consumption patterns, and reintroduce prohibition in specific areas if necessary.
The administration has also introduced a high excise duty structure on alcoholic beverages. Indian Made Foreign Liquor (IMFL) and foreign liquor will attract a 400% excise duty, beer 200%, and wine 80%.
Lakshadweep had maintained prohibition since 1979, primarily due to religious and cultural considerations. However, limited alcohol consumption had already been permitted for government officials and foreign tourists at select government-operated resorts and bars on islands such as Kavaratti and Bangaram.
According to officials, the policy shift is part of a broader strategy to strengthen Lakshadweep’s tourism sector and enhance its competitiveness with international destinations. The administration has argued that the previous prohibition regime placed the islands at a disadvantage compared to tourism-driven destinations such as the Maldives, where alcohol is available at designated tourist resorts.
Momentum for the policy change increased after Praful Khoda Patel assumed office as Administrator in 2020. Earlier proposals to expand alcohol availability had faced resistance from local political groups and residents who cited potential social and law-and-order concerns.
In February 2026, the administration designated government bungalows on Chetlat and Bitra islands as licensed premises, paving the way for the rollout of the new excise framework.
With the introduction of regulated liquor sales, the administration aims to balance tourism growth with regulatory oversight while retaining the authority to address any social concerns arising from the policy change.
