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Indian wine market sees a steep growth

The domestic wine market is expected to grow by 25-30 per cent by 2010. To encourage the growth the government is setting up an autonomous National Grape and Wine Board.

business Updated: Mar 30, 2007 12:29 IST

Measures adopted by the government to wean the population off spirits have indeed aided the growth of the wine industry. The domestic wine market is expected to grow by 25-30 per cent by 2010, says a report.


At this rate the wine industry is expected to touch 8.3 million litres by 2010, from the estimated 5 million bottles a year now. Most of the wine drinkers will be major cities like Delhi, Mumbai, Chennai, Kolkata, Pune and Bangalore, according to the Associated Chambers of Commerce and Industry of India (ASSOCHAM).

Besides, in an attempt to give a thrust to the Indian liquor industry, the government is drafting a separate wine and beer policy and is also examining the proposal to set up an autonomous National Grape and Wine Board.

The ministry of food processing in a proposal submitted to the National Manufacturing Competitiveness Commission (NMCC) said "a separate wine and beer policy is being evolved and the creation of an autonomous organisation, the National Grape and Wine Board, also needs attention".

The proposed board will be modelled broadly on the lines of other commodity boards such as the Coffee Board.

"The objectives of the board will be to promote the grape and wine industry in general and promote efforts among cultivators of grapes, manufacturers of raisins, juice and wine, and encourage contract farming," the ministry said in its proposal to the commission.

Besides, the board would also have the mandate to monitor cultivation and production of the desired variety of grapes and distribute best practices.

"The board will identify and develop appropriate rootstocks of grapes for different regions of the country and undertake research and development in new technology, products and processes for continuous modernisation of the wine industry," it said.

The Indian wine market is worth about Rs 450 crore, growing nearly three times as fast as traditional favorites - whisky and rum, although making up for only a fraction of the total Indian liquor market.

The other factors that will boost wine consumption in India, according to the report, include attitudinal shifts, affordability and the influence of the West.

ASSOCHAM President, Venugopal N. Dhoot, said, "Wine producers will have to educate consumers in order to market wine in India successfully. For this, many tasting and sampling events should be held. Also wine makers must ensure a regular supply."

In India the cost of setting up a 100,000 litres wine plant is about Rs 1.5 crore. ASSOCHAM is of the opinion that in the next few years there is scope for India to house more than 100 vineries of varying sizes.

There are three main wine producers in the country -- Champagne Indage, Sula and Grovers. Seagram's also recently announced its foray into the wine segment.

The Indian wine industry

· To touch 9.76 million bottles by 2010
· Growth: 25-30 per cent per annum
· Indian liquor market is growing at 10 per cent a year
· Indians consumed more than 220 million cases of beer, 60 million cases of whisky and other spirits in 2006
· The Indian wine market is approximately 5 million liters in volume terms and Rs 450 crore in value terms.
· Growth in the wine market is approximately 25 per cent a year.
· France accounts for almost half of India's wine imports and Italy 30 per cent.