An Analysis On Indian Wine INdustry

An Analysis on

Wine industry in
India

A Presentation by
S.Siyamalan
S.R.Swaminathan

Tamil Nadu Agricultural University

Synopsis
• Wine consumption --
Preferences
• Government Support
• The Market
• Scenario in southern
regions
• The essentials/Major
aspects
• Problems faced
Introduction
□ The People of India
–Annual Per Capita Income Rising
–Large Population Gives a Market Base
□ Government Backed Industry
–Wine Declared as “Small Scale”
□ Grape is grown over 60,000 ha - production
of 1.6 MT
□ Wine Industry Potential
–Market Currently in Infancy Stage
–Wines Beginning to Catch On Locally and
Source : FAO, 2005
Globally
The People Source: Yura Beverages
2 2 2 2 2 2
0 0 0 0 0 0
Indian Economy
0 0 0 0 0 1
5 6 7 8 9 0
1,095. 1,110. 1,125. 1,140. 1,155. 1,169.
Population (millions)
4 4 4 2 0 7
Household consumption (US$

2028 2210 2419 2651 2910 3176
billion)
Growth: 9% 9.4 9.5 9.7

9.1
□ The rising middle class within India is bringing with

it a higher rate of consumption
□ Wine consumption is also increasing at a rate of
0.5ml per year/ per person
Government Support
• Wine Declared as a “Small Scale” Industry
– Manufacturers exempted from excise duties
• 38 Wineries Currently in Operation
– 36 located within Maharashtra
– 5.4mn liters produced annually within
Maharashtra
– India totals 762,000 cases sold per year
State Bank of India, for the first time in the country,

has taken the initiative for helping the grape growers
via project UPTECH
Government support Contd..
• The
concessions/incentives/subsidi
es grants etc. are extended to
“Wine Industry” at par with
Food Processing industries
– project subsidy of Rs.50

lakhs/wine unit
– Rs.10 lakhs per year
towards procurement of
grapes
– grant of Rs.4 crores / wine
The Market
Source: Food Press Release
• Wine expanded phenomenally by around 18% in

2007
• Total Indian Consumption has risen to 650,000
cases (2007-2008)
– 6-7ml annual per capital consumption
• Target Market
– Middle class ages 25-39
– Current biggest wine consumers
• Trendy upper class
Marketing
• Open Markets
– Maharashtra, Jammu Kashmir, Goa, Assam,
Meghalaya, Tripura, and Arunachal Pradesh.
• Auction Markets
– Rajasthan, Madhya Pradesh, Bihar, Haryana
and Chandigarh
• Government Markets
– The governments of the respective states act
as the wholesalers
– TASMAC in Tamil Nadu, BEVCO in Kerala, APBC
in Andhra Pradesh and The DSIDC in Delhi
Consumer Preferences
Source: Food Press Release
Wine Consumption
Red 45%
White 40%
Sparkling 13%
Rosé 2%
□Traditional Red and White wines account

for 85% of Indian wine consumption
The Current Scenario
in Southern Regions
Indigenous Wineries
• Chateau Indage
– 18 types of wine
• Chardonnay, Cabernet Sauvignon,
Ugni Blanc,
Pinot Noir, Gamay, Riesling, Muscat of
Alexandria
Sauvignon Blanc, Chenin Blanc,
Zinfandel,
Viognier, Shiraz, Malbec and Grenache
• Grover Vineyards
– Nine varieties
• Zinfandel ,Chardonnay, Pinot Noir,
Sauvignon Blanc, Chenin
Blanc,Viognier, Shiraz,
Viognier and Semillon
• Sula winery
Maharashtra wine Grape
policies
• Declaration as a Preferential Area
• Declaration as a Small Scale
Industry
• Concessions in Excise Duty
• Concessions in Sales Tax
• Wine Sales License
• Wine Sales License Fee
• Simplification in the system of
License
• Establishment of Wine Institute
• One Window System
• Establishment of Grapes Board
Wine Parks
• To encourage value addition on grapes
• Grape Board
– for quality control, certification and export
promotion.
• Wine Institute
– long-term growth strategy.
• MIDC has set up Wine Parks with International

comparable infrastructure
– at Vinchur, near Nashik & Palus, near Sangli
Karnataka
• The Government intends to
– Establish two Wine Parks.
– Capital Investment Subsidy
– Subsidy for Grape Processing
– Incentives for marketing and distribution of

wines
Andhra
• Government of Andhra Pradesh has issued
G.O.framing new rules on Winery projects.
• Very low fee of Rs. 2000 per annum is fixed as

license fee to encourage this industry.
• Government may call for applications for grant of

letters of intent in the near future.
Winery Project in Tamil
Nadu
• Tamil Nadu produces 90,000 tonnes of Muscat
Grapes and 10,000 tonnes of Thomson Seedless
Grapes.
• Government of Tamil Nadu has issued a

Notification on Tamil Nadu Wine Manufacture
Rules 2006 for regulating manufacture of wine.
• Government of Tamil Nadu has approved the

proposal of TIDCO for establishing a Winery
TIDCO’s Initiative
TIDCO proposes to establish wine making units in association with
private sector.
The prospective entrepreneurs may like to contact Thiru B.

Ramakrishnan, General Manager, TIDCO for further details at Cell
Major aspects
• The primary factors acting as
constrain for this industry in India.
• At the very outset we have four

major issues to note:
1. Legal aspect,
2. Global aspect,
3. Social aspect and
4. Promotional aspect.
Problems Faced..
• Wine drinking has not caught on
– quality wines are priced relatively high.
– Since the volumes are low, production costs
are high, as are taxes.
• Real challenge -to develop a domestic market

• Huge prohibiting factor - 300 per cent duty slab
• To distribute finished goods
Various taxes and duties applicable to
the wine industry
• Excise Duty • Raw Material Excise
• • Availability Fee
Additional Duty
• Brand/Label Fee
• Markets & Regulations • Transportation Fee
• Centre for Civil Society • Import Pass Fee
• Distillery/Brewery License • Export Pass Fee
Fee • Vend Fee
• Bottling fee • Sales Tax/Surcharge
• • License Fee
Litterage fee
• Toll Tax
• Assessment Fee
• Excise Duty
• Franchise Fee
• Additional Duty
• Permit Fee
• Gallon age Fee
• Various taxes and duties
applicable to the wine
Standards
• Ethyl alcohol -prescribed in 4 of IS 3752:1988
– Enforced by State Excise Authority
• Food additives - PFA /CODEX /JECFA
• Flavor -PFA/FEMA GRAS
• Carbonation -Grade 2 of IS 307:1996
• Packing
– glass bottles -IS 1662:1974
– plastic bottles made of PET -IS 14537:1998
• Sampling - IS 3753:1984
Conclusion
• Presently Indian wine industry is in a nascent stage,
though it has kick started only from Maharashtra
much remains to be seen at the national level.
• Indians will have to descriminate wines with other
alcoholic liqours.
• The wine in fact is a social and health drink,
– its consumption has to be promoted through various
media campaigns and wine festivals.
We hope, subsequently there exists a

huge scope for expansion
in area and production of wine grapes in our
country.
References
1. Multiple aspects of Indian Wine Industry

− Karnika Seth
• Present Scenario of wine industry in India
− G.S.Karibasappa , P.G.Adsule , S.D.Sawant and K.Banerjee
N.R.C. for grapes, Manjri Farm, Pune – 412 307.
3. Wine project APICTO
4. Winery Project TIDCO
5. Maharashtra’s grape policy 2001
6. Karnataka Grape Processing and Wine Policy – 2007
7. D’Essenceconsulting – WineReport
8. Wine Industry in Maharashtra
− Sudipto Mitra

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An Analysis on

Tamil Nadu Agricultural University

Household consumption (US$

Growth: 9% 9.4 9.5 9.7

□ The rising middle class within India is bringing with

State Bank of India, for the first time in the country,

– project subsidy of Rs.50

• Wine expanded phenomenally by around 18% in

□Traditional Red and White wines account

• MIDC has set up Wine Parks with International

– Establish two Wine Parks.

– Capital Investment Subsidy

– Subsidy for Grape Processing

– Incentives for marketing and distribution of

• Very low fee of Rs. 2000 per annum is fixed as

• Government may call for applications for grant of

• Government of Tamil Nadu has issued a

• Government of Tamil Nadu has approved the

The prospective entrepreneurs may like to contact Thiru B.

• At the very outset we have four

• Real challenge -to develop a domestic market

We hope, subsequently there exists a

1. Multiple aspects of Indian Wine Industry

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