India’s commercial wine industry is not young, dating back about 30 or 40 years. Yet it’s small, confined largely to Maharashtra and Karnataka, growth has been steady if slow but the comfort of the past is now threatened by the free trade agreements India has signed.
In a word, competition is around the corner and although the sense in the industry is that the market will grow, it’s not clear how many wine growers in India will survive.
“It’s a matter of concern,” admitted Ashwin Rodrigues, Director of the Wine Growers Association of India in a conversation on The Gist. “We have been a highly protected industry with customs tariffs of about 150% and although that changed after the trade deal with Australia in 2022, we were able to do stay the course.”
Now there’s a massive India-EU FTA that could be finalised by the end of the year, and given that Europe is a major producer of wine, it’s clear there will be a flood of great wines entering the market, good for wine connoisseurs here.
“The price difference between Indian and European wines will reduce,” Rodrigues said, “consumers may migrate to European wines so saving our sales numbers will be a challenge in the short term.”
But in the medium to long term things could get better if the local industry takes up the challenge to improve quality and develops the ecosystem for wine in India.
Rodrigues believes the government must step in and take strong measures against the rampant under-invoicing of imported wines. What should cost $5 is shown in the documentation as costing far less, about $2 $3. That has narrowed down the price differential with Indian wines.
But far more important is the point that the cheaper variety of wines get sold and Indians are drinking these not so great varieties.
“What we are advocating with the powers that be is levying a fixed fee of about $300 or $400 dollars regardless of what the import price is.”
There are other issues, less regulations, more “last mile” help for growers, assistance in brand building. Three or four decades only underscores how young the Indian wine industry and more targeted help for wine growers could see the growth of wine tourism that is a huge industry in Europe.
Tune in for more in this conversation with Ashwin Rodrigues, Director of the Wine Growers Association of India.
