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