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Corruption is making Bengaluru’s restaurateurs abandon the industry



For every new restobar that opens in Bengaluru, another shuts down. Procuring 36 approvals — higher than the national average — and not to mention corruption, has made Bengaluru the most challenging city in India for the restaurant industry. While the government believes that Sakala — guarantee of services to citizens through an online platform — has brought transparency, the industry continues to be sceptical.
ET digs deeper to understand what it takes to run a restaurant in Bengaluru.

When Bengaluru was just a sleepy little town in the 1980s, entrepreneur Ashok Sadhwani smelt a fortune in the pub business. Noting the rush for the draught beer at the newly set-up bar by the Khoday’s Group on Church Street, Sadhwani decided to leave his failing textile business to open a fancy pub on the same stretch. It was The Pub.

Four years later, he opened another, called The Pub World, on Residency Road. Bengaluru simply loved its pubs. Much later, in 2007, he went on to open a restobar, Couch, on MG Road.

Cut to 2019, all the three have shut down. The Pub World, which stood the test of time for nearly three decades, had to be closed due to the National Highway ban. The Pub, later known as NASA, was the first casualty of the 11.30 pm party deadline, and it closed doors in 2010.

“Owning a pub sounds glamorous. In reality, it is not. Sustaining the business is a headache, with constantly changing policies of the government,” says Sadhwani. He listed the top three reasons for shutting down his three bars: the early party deadline; forced purchase of liquor in higher quantity (by the excise department); and the most recent ban on liquor outlets on highways.

“We had to run from pillar to post to get multiple approvals. It was getting increasingly difficult to work with the excise department, which was adding to our misery. It was better to retire from the hospitality business than to live with the turmoil,” says Sadhwani, among the first to start Bengaluru’s famous “pub culture.”

The man who set the ball rolling — the city has 406 pubs today — does not want to return to the business of liquor. He would rather open a restaurant minus liquor. What’s more, he will never prescribe the F&B industry in Bengaluru as a business proposition to anybody.

Bengaluru, one of the top contributors to India’s flourishing Rs 6,00,000 crore F&B industry, is earning the dubious reputation of being the most challenging city to run a bar or a restaurant in. Industry insiders say a total of 36 approvals, including licences and NOCs, are required to open a restaurant in Bengaluru.

While at least one new restaurant opens every month in the city, there is another that closes shutters. While a new wave of restobars like Atomic Lab, Bartin’s and Nevermind and Bier Garten have rolled their dices in the F&B gamble, others such as Take 5 and City Bar succumbed. In August 2018, Viraj Suvarna closed down the very popular 15-year-old Take 5 due to the ban on live music. “Take 5 was a platform for many emerging musicians. We used to feature many live music bands and standup comedy evenings, but the government put us in the same bracket as dance bars,” says Suvarna.

Procuring the entertainment licence required an array of related NOCs, including occupancy certificate (OC) and fire safety certificate. “We could not produce the OC as the building is old and the landlord did not have the document. Since we stopped playing music, our footfall dropped drastically. Closing it down was the only option,” he says. Law enforcement agencies assume that restaurateurs make a lot of money, but that is not true, he says.


ET spoke to a number of restaurateurs in the city, who wished to be unnamed, to give an insight into the challenges they face in running a restaurant and surviving in the fiercely competitive industry.

The industry believes a series of “outdated” licences and corruption are the topmost factors that make this business difficult. Procuring licences and NOCs for opening a restaurant, apparently, comes at a “fixed rate,” they say.


A restaurateur who has set up microbreweries in east and north Bengaluru says that he shelled out a bribe of Rs 70 lakh for a microbrewery licence that officially costs Rs 3.5 lakh.

Running a restobar is no joke, say the restaurateurs. A pub owner in central Bengaluru says he sets aside Rs 1 lakh per month to bribe officials for “peaceful running” of his two outlets. This, after having paid hefty amounts for various approvals and annual renewals. The jurisdictional police, mobile police squads and excise officials, all want a fixed portion of the pie, he says.

It is not that restaurants are not to blame. Says a bar chain owner, “The restaurant business is a two-way street. To get some work done, there is a cost involved. For instance, procuring an OC is almost impossible. This opens up an avenue for corruption.”

The ban on live music that made headlines last year also became a moneyspinner. While revellers want high decibel levels, it invariably invites the wrath of many residents, especially senior citizens. Sneha Nandihal, member of I Change Indiranagar, a resident welfare association, says, “Loud music into the wee hours, clogged residential streets due to haphazard parking, and security threat due to drunken revellers continue to disturb us. The cops arrive only when we lodge a complaint.”

Ilegalities thrive by daylight, too. Absence of a fire escape, basements and rooftops lent for commercial purposes and no enclosed smoking spaces are there for everybody to see. The authorities, who enforce rules when a disaster takes place, turn a blind eye the rest of the time. According to the National Restaurant Association of India, a few black sheep spoil the scene and the enforcing agencies come down heavily on all with blanket policies.


Restaurateur Riyaaz Amlani wants an urgent relook at a few “archaic” laws, which, he says, were created in the ’50s and ’70s.

“We need a total of 36 approvals to open a restaurant in Bengaluru. Delhi asks for 26 while Mumbai caps it at 22. Where there is excess of regulation, there will be some degree of ‘condonation’ fee,” says Amlani, suggesting a few changes. For starters, he would like a single-window clearance to avoid being caught in the interdepartmental wars and arbitrary rules. “Restaurants are looked upon as evil…as a rich man’s indulgence. It is, however, the second highest employment- and revenue-generating industry after retail. F&B is vital infrastructure for a healthy city. The government should recognise it,” he says.

The state excise department, however, says it has come up with several reforms to set right the anomalies. Yashwanth V, excise commissioner, says, “All the excise-related services are brought under the Sakala scheme, which provides guarantee of services within a stipulated time. We are also working on a facility that will allow restaurateurs to buy liquor stock online.” He dismisses all accusations of corruption and promises to work with the industry.

Restaurateurs are skeptical though. “Yes, it is possible to open a restaurant without paying bribes, but one needs political support. Some of us, however, prefer to pay the bribe than seek political help as it can backfire and create deeper holes in our pockets in the long run,” says a restaurateur who wish to be unnamed.

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