Excise minister M B Rajesh sought to turn the tables on opposition leader V D Satheesan saying that the existence of the Cabinet note rather than implicate the government in a liquor scandal only undermined the Congress charges.

"The Cabinet note only demonstrates that it was not in secrecy that the decision was taken to grant preliminary sanction for Oasis Commercial Private Limited to start a liquor manufacturing unit at Elappully in Palakkad," the minister told reporters in Thiruvananthapuram on Wednesday, January 29.

The minister then gave an assurance and raised a suspicion. He said that "not a drop of underground water" would be used for the proposed liquor plant. The plant would require just 1.1% of the water requirement of the entire Palakkad municipality.

This, he said, would be met in two ways: one, from the 10 million litres a day (MLD) of water that would be supplied from the Malampuzha dam to the Palakkad Kinfra industrial park for which an agreement was struck in 2015, during Oommen Chandy's tenure; and two, from the harvesting of rain water.

Has Chennithala brokered deal with Karnataka liquor barons?
Along with the assurance, the excise minister aired his suspicion. Rajesh wanted to know whether Congress leader Ramesh Chennithala had secret talks with Congress leaders who ran liquor manufacturing units in Maharashtra and Karnataka to sabotage the government plan that would eventually stop the import of spirits from outside distilleries. "The former opposition leader should tell us if he had held secret talks with liquor barons and if so, for what," he said.

The minister said that spirit worth Rs 4200 crore was flowing to Kerala from the manufacturing units of Congress leaders in Maharashtra and Karnataka. "This is causing a huge drain on Kerala's resources. The loss on the GST account alone is Rs 210 crore. Then there are transportation gains we could have," he said, and added: "Is it not intriguing that the Opposition is trying to kick up a fuss about a decision that would provide huge financial gains to Kerala?"

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Will Oasis dry up Palakkad like Coca Cola
The excise minister once again stressed that "not a drop of underground water" would be used for the proposed liquor plant. He said the plant would require just 1.1% of the water requirement of the entire Palakkad municipality. The minister said that the Congress had misled the public. He reeled out figures to rule out water scarcity. "There is no need to exploit groundwater," Rajesh said.

The Malampuzha dam reservoir has a capacity of 2.23 lakh million litres. The entire Palakkad Municipality and the panchayats it serves fully (Puthiyapuram, Akathathara and Marutharode) and partially (Pirayiri and Mundur), even assuming that they would require the same amount of drinking water during the rainy season would require 81.5 million litres a day. Meaning 29,747.5 million litres a year. "This is just 13.16% of the reservoir capacity," the excise minister said.

In the first stage, when it operates as just an ethanol manufacturing unit, the proposed liquor plant would require 0.05 million litres daily. At full capacity, which would take years to reach, it would be 0.5 million litres. "And this is just 1.1% of the water required for Palakkad municipality," the minister said.

Further, he said that Kerala Water Authority would not make additional arrangements to provide water to the liquor unit. "A project to supply 10 million litres a day to the Kinfra Park and Palakkad IIT is progressing. The company will be provided water from this supply line," he said. It will be Kinfra's share that will be diverted to the liquor plant. Moreover, the minister said that the agreement to provide water to Kinfra was inked in 2015 under the UDF regime. "In fact, the decision was taken way back in 2011," the minister said.

Was there a CPM-Oasis deal?
Early in the day, the opposition leader had held up the Cabinet note and said that it revealed that no departments were consulted or their permissions sought before moving the file related to the private liquor manufacturing unit.

"This was a decision taken by the Chief Minister and excise minister without taking into confidence either the government or the LDF constituents," Satheesan said on Wednesday, January 29. "Why was there such secrecy," he had asked.

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The excise minister referred to the government order granting preliminary clearance for the ethanol plant/multi-feed distillation unit/IMFL bottling unit/brewery/malt spirit plant/brandy-winery plant and the attached cabinet note and asked: "Has any government been as transparent as this?"

The opposition charge was that if Oasis Commercial was the only company that expressed interest in setting up the liquor plant, it was because Oasis was the only company that the government had informed the change in Excise Policy.

The excise minister said that the government's excise policy for 2022-23 and 2023-24 had specifically said that the domestic production of Extra Neutral Alcohol, the raw material for manufacturing Indian Made Foreign Liquor (IMFL), should be encouraged as its import was draining Kerala's coffers.

"The policy is public. It is there for anyone to see. How can anyone not know it? Both the opposition leader and the former opposition leader had responded to them. They should have at least remembered what they had said," Rajesh said.

Was Oasis given clearance in haste?
The excise minister said that the application for the plant was submitted before the excise circle inspector on November 30, 2023. "The preliminary clearance was given only on January 16, 2025, after a 10-stage examination. This means even the first clearance took 14 months. Not a single stage was skipped," Rajesh said.

Further, the minister said that when the file came before him on March 16, 2024, he had returned the file seeking more clarity on the water requirement for the project. The excise commissioner submitted his report on May 28, 2024. "It was on the basis of this report on water availability that the preliminary clearance was granted," the minister said.

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Can rainwater be harvested in Elappully?
Chennithala had repeatedly ridiculed the government's claim that rainwater would be harvested in five acres to provide water to the plant. He said Elappully was in the rain shadow region and, therefore, unsuitable for rainwater harvesting.

The excise minister said that the Ahalya Campus in Palakkad - Ahalia Health, Heritage and Knowledge Village (AHHKV) - that spreads over areas of severe water scarcity like Vadakarapathy (Chittur taluk) and Elappully generated 24 crore litres of water from 12 rainwater harvesting farms. "Kinfra, too, has rainwater harvesting farms in these areas," he said and invited the media to visit these farms on February 17.

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