Maharashtra to allow sale of wine in supermarkets, stores
This move will ensure a more accessible marketing channel for Indian wineries even as the two-decade-long tax holiday for wine produced in Maharashtra ended on December 31, 2021
Mumbai: In a move aimed at giving a boost to the wine industry, the state cabinet on Thursday cleared a proposal to sell wine in supermarkets and walk-in stores across Maharashtra at a flat annual licensing fee of ₹ 5,000.
This move will ensure a more accessible marketing channel for Indian wineries even as the two-decade-long tax holiday for wine produced in Maharashtra ended on December 31, 2021.
The decision will also ensure a level playing field for supermarkets and walk-in stores across the state, when it comes to licensing fees to stock wine for retail sale. At present, fees for beer shopee (currently available to supermarkets to stock wine and beer) depends on the slab that the city or town falls under, based on its population — and often exceeds the new amount decided upon.
“We have many wineries in Maharashtra and to boost their business, the state government has decided to allow them to sell wine at supermarkets having an area of 1,000 square feet… No permission will be given to any shop smaller than 1,000 square feet. The decision will also help the farmers get better prices for their produce and was taken considering their interest,” said Nawab Malik, minister for skill development and minority affairs.
Of the close to 110 wineries in India, Maharashtra has 72 wineries, of which around 40 to 45 are operational. Of these, just around 15 to 20 units are into direct marketing, while the rest are involved in contract manufacturing.
The cabinet’s decision will apply to establishments which have an area of at least 100 square metres and are registered under the Maharashtra Shops and Establishments (Regulation of Employment and Conditions of Service) Act, 2017. Supermarkets and walk-in stores will be allowed to retail wine in sealed bottles for “off-consumption” as per the “shelf in shop” concept — a separate lockable shelf of 2.25 cubic metre will have to be installed for wine to ensure that it is not retailed with other products.
Though some supermarkets stock wine, they have to seek a beer shopee license which allows them to retail both wine and beer, but carries steep and varied license fees.
Wine bars, which already sell wine for consumption, but only in their premises (using what is called the E-2 license) will also be allowed to sell wine in sealed bottles for off consumption. There are around 40 such establishments in the state. The department is also considering allowing shops to retail only wine— at present, only wineries can launch an outlet to sell wine.
“Despite excise duty holidays and concessions, the sale of wine has not picked up in Maharashtra. One reason for this is the lack of exposure to consumers,” said a senior state government official. He added the state excise department would soon clear more measures to enhance retail availability of wine by opening up alternate channels.
There are around 1,685 wine shops in the state. The wine industry has a turnover of around ₹1,000 crore in India, of which 65% in Maharashtra. Most wineries are located in Nashik, which produces around 80% of India’s wine, and is referred to as the wine and grape capital of India, followed by Sangli, Pune, Solapur, Buldhana and Ahmednagar.
India sees around 4 million cases of domestically produced and imported wine (one case includes 12 bottles of 750 ml each) being consumed. Maharashtra’s share hovers around 40%. However, India lags in wine consumption with per capita consumption estimated at a miniscule 10ml compared to 4 liters in China.
“A growth in wine sales will boost the backward linkages and strengthen the value chain. The industry will grow and the rural economy will get a boost… this will benefit not just wine grape cultivators, but the horticulture sector, as other fruits (like bananas and flowers) are also used to produce wine,” said Jagdish Holkar, President, All India Wine Producers Association (AIWPA).
Maharashtra is said to have the right soil, topography, mineral content, weather and water for growing grapes. One of the leading producers of table grapes, Maharashtra grows wine grapes on just 5,000-acre land, compared to 2.5 to 3 lakh acre for table grapes. Internationally, most grape cultivation takes place for wine production. On an average, one kg of grapes can be used to produce around 600 ml wine.
Former chief minister and leader of Opposition Devendra Fadnavis called this move an attempt by the government to make Maharashtra into a “Madyarashtra” (liquor capital).