Alcohol use is ranked among the leading causes of liver disease in the world, and the most dreadful consequences of this condition are cirrhosis and hepatic cellular carcinoma (HCC). India has an eclectic policy environment, with bans, regulation, liberal paradigms, and the influence of such policies on the epidemiological process is inadequately studied. Based on the Global Burden of Disease (GBD) 2021 data of nine states (2000–2021), this study focuses on disability-adjusted life years (DALYs), years of life lost (YLLs), and years lived with disability (YLDs) due to alcohol-related cirrhosis and HCC. States were classified as prohibited (Bihar, Gujarat, Nagaland), regulated (Karnataka, Kerala, Tamil Nadu), and liberal (Goa, Punjab, Sikkim). Liberal states had the highest burdens, with Sikkim leading by approximately (410 per 100,000), followed by Goa (360 per 100,000) and Punjab (290 per 100,000), all above prohibited state averages. In Bihar, there was 27% reduction of DALY, whereas Kerala had the highest increase of 44%. More than 90% of total variation in DALYs was attributed to YLLs, with men also experiencing larger overall burden, ranging between 4–5 and 8–11 times during midlife. The panel regression displayed low cohort-level variance ( \({\text{R}}^{2}\) = 0.41) but strong state-level effects ( \({\text{R}}^{2}\) = 0.98), that signify a high level of heterogeneity. These results show that in addition to policies, variations in implementation, fiscal priorities, and social contexts determine the burden experienced in India, which further points to the need to implement evidence-supported, targeted interventions.