Thiruvananthapuram: Kerala Excise Minister M B Rajesh on Monday said that the proposed brewery unit in Elappully, Palakkad, would not lead to water scarcity in the region.

In response to a question raised by IUML MLA P Mammikutty seeking to know whether the plant will cause water shortage, the excise minister said that only 13.19 per cent of the Malampuzha dam’s storage capacity is utilised for drinking water and agriculture. There is no possibility of a water shortage due to the brewery, he added.

The minister also said that not even a drop of groundwater would be extracted for the ethanol and liquor manufacturing unit. The proposal from Oasis Commercial Private Ltd was cleared after ensuring that not a single drop of groundwater would be extracted for the project, the minister added.

He noted that the Kerala Industrial Infrastructure Development Corporation (KINFRA) already supplies 10 million litres of water for industrial purposes through rainwater harvesting. This agreement was made during the tenure of former Chief Minister Oommen Chandy in 2015, and Oasis Commercial Pvt Ltd will receive its share like other industries, he added.

Meanwhile, former Leader of the Opposition Ramesh Chennithala criticised the government, pointing out that those who had protested against the Coca-Cola plant over water exploitation were now supporting a liquor manufacturing company.

In response, Rajesh clarified that the protests in the past were against the exploitation of underground water and the pollution of water sources. "The initial approval for Oasis was granted only after receiving an assurance that groundwater would not be used for the project," he said.

The minister claimed that the proposed unit would generate over Rs 100 crore in GST revenue for the state. He also countered Leader of Opposition V D Satheesan's argument that spirit imports into Kerala were not subject to GST. "That statement is factually incorrect. While extra neutral alcohol (ENA) is exempt from GST, ethanol is taxed at 5 per cent," he said.

Rajesh further added that Kerala currently imports 30.26 crore litres of ethanol annually, which is expected to reach 75 crore litres by 2030, leading to a business volume of Rs 600 crore to Rs 1,000 crore. "The government's goal is to produce spirit for industrial purposes within the state and export liquor, thereby creating more employment opportunities," he said, adding that it will encourage all entrepreneurs approaching it.

The minister observed that spirit is imported into Kerala from Maharashtra, Karnataka, Telangana, Andhra Pradesh, Rajasthan, and Daman and Diu, with Maharashtra being the largest supplier, providing 2.68 lakh crore litres.

The minister claimed that several of these companies have political connections and that a minister serves as the chairman of a Karnataka-based company, while some MLCs hold positions on the director boards of others.