Temptations of Narcotics Legalisation
One of the major fallouts of the Sushant Singh Rajput (SSR) case is the sudden interest in legalising/decriminalising consumption of a small list of psychotropic substances in the country.
 
The timing of the debate may have had Bollywood origins, but the economics of the debate has a long history in India.  
 
Narcotics and psychotropic substances include a long list of both naturally occurring and synthetic compounds. The cannabinoids and opioids are naturally occurring and, over the years, through chemical treatment, many new compounds have been created from plants such as heroin.
 
The medicinal use of the cannabinoids and opioids has long been known in Asia. If one goes by the (Eurocentric) history of opium on the Central Narcotics Bureaus website, the properties of the plant have been well documented since 1000 CE. Similarly medicinal use of cannabinoids has been known since 1000 BCE in India. Further, the practice of using seeds and oil from these plants as condiments and spices continues to this day.  
 
The available recorded history of these plants does not indicate a large-scale recreational use of these plants in Asia. The Arthasastra talks about taxing/licensing alcohol but not psychotropic substances. In fact, until 1750, these plants have never been used as source of revenue for the State by promoting recreational use. 
 
However, this changed with the arrival of the British in India. Following the 1606 Queen Elizabeth I Charter to purchase the finest Indian opium and transport it back to England, the subsequent British expansion in India was closely tied to areas that produced opium. 
 
The British East India Company assumed control of Bengal and Bihar, opium-growing districts of India in 1750. It zealously pursued a revenue maximisation policy through a monopoly by promoting recreational use of opioids domestically and through exports in China. With the annexation of Sindh in 1840 all possible access to the sea except through company’s ports was cut-off for the so-called rival Malwa opium. 
 
Forced poppy cultivation ultimately became a factor in triggering the First War of Independence in 1857. This led to the passage of the Opium Act 1857 to regulate the cultivation of opium poppy and manufacture of opium. This was followed by the Indian Opium Act of 1878 to control smuggling, the private possession and trade in opium thereby securing government monopoly. 
 
At the height of its opium trade, the British India government derived a quarter of its total revenue from this single commodity. Thus, when the United States took notice of large-scale opium addiction in its colony Philippines in 1898 and decided to pursue a foreign policy to dismantle the Sino-Indian opium trade in 1900s, the British were quick to realise—loss of opium revenue implied liquidation of the empire.
 
It would not be before 1917 that the Sino-Indian opium trade would be fully dismantled. With falling exports since 1907, a part of the revenue would be compensated by encouraging domestic consumption of opium through licensed shops. Gandhi's political agitation in opposition to the official distribution of drugs pressurised the colonial authorities to sign the Geneva Convention of 1925.The growing addiction and opposition from Indian leaders led to the passing of the Dangerous Drugs Act, 1930.
 
The weight of domestic and international events in respect of controlling illicit trade and production in narcotic substances prior to independence would eventually devolve on the government of independent India. The Article 47 of the Constitution says—“the State shall endeavour to bring about prohibition of the consumption except for medicinal purposes of intoxicating drinks and of drugs which are injurious to health.” State governments in post-independence period would pursue divergent policies depending on its revenue dependency on intoxicating drinks and drugs. While most of the states adopted a tight regulation, the state of Gujarat went for complete prohibition of alcohol but not of drugs. 
 
Post-independence dynamics of trade in drugs in South Asia was further complicated by geography. Independent India was now sandwiched between the Golden Crescent in the West and the Golden Triangle in the East, making India a transit point for the trade in contrabands. The situation would be further complicated by the 1980 Cold War geopolitics as the dividing line between trade in contraband and state objectives blurred. Thus, the period between 1947 and 1985 would see a resurgence in the outflow of narcotic substances from South Asia, including India. 
 
Thus, under international pressure, the Indian Parliament enacted a comprehensive legislation on narcotics drugs & psychotropic substances, namely, the Narcotic Drugs & Psychotropic Substances Act, 1985, repealing the Opium Act 1857, Opium Act 1878 and Dangerous Drugs Act, 1930. 
 
This murky, often glossed over, history of drug trade in South Asia offers many points to ponder upon. First, does any policy to legalise the consumption of substance XYZ (of course not out of kindness of heart) to raise revenues, imply legalising its production? If not, then it opens the doors for imports or for a thriving black market and eventual compromise of institutions. What signal does legalising consumption send?
 
Second, a policy of revenue maximisation is a slippery slope; higher revenues come at cost of social depredation. Ignoring the dividing line between medicinal and recreational uses is not learning from history and following the imperialist policy all over again. The Assam Opium Enquiry Committee, an informal group set up by the Congress in 1925, concluded that 'when public opinion is awake and active', then the solution to the drugs problem becomes easier.
 
The 2019 All India Institute of Medical Sciences (AIIMS) survey on substance dependency estimates that more than 5.7 crore people are affected by harmful or dependent alcohol use. About 72 lakh individuals need help for their cannabis use problems. An estimated 60 lakh people suffer from opioid use disorders. Will these numbers remain static? From where will resources for rehabilitation be raised—by legalising the very same product!
 
Third, the objective of controlling the drug problem is intrinsically linked to the ability of states to garner sufficient revenues. The present federal structure still carries the remnants of the colonial policy of using intoxicants as a source of revenue at state level. The divergent practices adopted by states just after independence only proves this point. Intoxicants have been kept outside the goods and services tax (GST) as there is reluctance to part with a highly price inelastic tax base. Thus in a sense, anti-narcotics objectives and cooperative federalism are two sides of the same coin in the Indian context. If the GST compensation issue persists for too long, the clamour to legalise will only grow further. 
 
(The author is an economist in the banking system. The views are personal) 
 
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