Thiruvananthapuram, Dec. 18: Happy days are back for tipplers in Kerala.

The state government today not just revoked its declaration of Sundays as dry days, it decided to grant 'beer and wine parlour licences' to all the bars shut by its earlier stringent liquor policy.

This means the 418 bars branded substandard and closed in April can reopen to sell beer and wine - though not hard liquor like before.

The decision to grant fresh bar licences only to bars in hotels with five or more stars, however, stands.

Chief minister Oommen Chandy explained the change in stand, decided at a state cabinet meeting, by saying that the dry Sundays initiative had not produced results but had hurt the tourism sector.

The Congress-led United Democratic Front government had appointed a committee made up of the labour and tourism secretaries to study the impact of the crackdown on bars. The committee reported that it was hurting tourism.

Reports from the ground too spoke of thinner tourist crowds in areas like Kovalam despite this being the peak season.

Chandy said the policy had, on the other hand, failed to curb drinking. He said that sales at the state-owned Beverages Corporation (BevCo), the sole retailer of Indian-made foreign liquor in Kerala, had shot up 60 per cent on Saturdays after Sunday was declared a dry day.

Bar customers, though, must live with two hours less of drinking time. Bars will now open at 9am and close at 10pm, compared with the current 8am-to-11pm regimen.

Ruling ally Indian Union Muslim League had opposed the move to grant beer and wine parlour licences, saying it was in favour of total prohibition, Chandy added.

Seeking to give the cabinet decision a humane face, the chief minister said the beer and wine parlour licence was also meant to protect the workers who had become jobless after the bars shut down. The parlours should retain their previous employees, he said.

Apparently to avoid being seen as promoting drinking, the government has also decided to close 10 per cent of the 163 BevCo outlets set up along the national highways from January 1. This is in keeping with a high court directive to close liquor shops along the highways, Chandy said.

In April, the state government had closed down 418 bars saying they did not meet prescribed standards. In August, the cabinet decided to further shut all bars other than those operating in the state's 21 five-star hotels.

Initially, the high court partially approved the move, sparing the 34 four-star and eight heritage hotels from closure as well but upholding the policy of shutting all the other bars across the state.

But a division bench later stayed the move saying it was discriminatory, thus allowing the 278 two and three-star bars to stay open.

State Congress president V.M. Sudheeran was one of the prime movers behind the tough liquor policy. But with a source of Rs 9,000 crore worth of revenues under threat, no one expected the government to continue with it.

A meeting of the ruling allies had asked the government to take a suitable decision, with Sudheeran sounding a dissenting note.

Kerala has one of the highest per capita (counting only those above the legal drinking age) alcohol consumption figures: 8 litres annually.