The Hindu Business Line : Not just wine, but beer too would flow freely!

WINE-MAKERS may be popping the bubbly as the Centre prepares to loosen its grip on wine. But the "preferential treatment" given to wine could be extended to beer too.

As Maharashtra sits on the fence on whether `wine should flow as freely as Coca-Cola', a joint-working group (JWG) headed by the Union Food Processing Ministry has recommended that wine and beer be given "preferential treatment".

Wine is already on the agenda, in terms of making it more accessible in the mass market. Beer still has to sort out some frothy issues, but the direction on the issue is to bring it outside the ambit of hard liquor, said Mr A.N.P. Sinha, Joint Secretary with the apex ministry and Chairman of the JWG.

However, the degree of preference that will be granted to beer and wine will be further discussed within the JWG after getting feedback from the industry, he told Business Line.

Some of the avenues discussed by the JWG in its recent report include preferential treatment in terms of licensing of manufacture, sales and duty/fee concessions. Uttar Pradesh, for instance, permits sale of wine at departmental and general stores. It grants licenses for wineries freely, besides giving concessional duty on wine and beer.

While the apex Ministry offers financial assistance to the wine industry in terms of grants etc, it has suggested that other States and Union Territories explore wine parks and wine production units in their regions. The report also recommends the branding and packaging of traditional drinks such as neera and fenny.

The domestic beer market is estimated to be about 86 million cases and Kerala, Andhra Pradesh, Tamil Nadu and Pondicherry account for 45 per cent of the country's consumption. The consolidated nature of the market allows attractive profit margins and the segment is dominated by the United Breweries group, the report observes. In contrast, the Chinese beer market is marked by competition with about 400 brewers. Lower taxes, falling distribution margins and prices have contributed to the surge in consumption of beer in India.

Wine in India is an estimated Rs 260-crore market. Consumed largely in urban India, Mumbai accounts for about 40 per cent of the country's wine sales, followed by Delhi, Goa and Bangalore. Red wine sparkles at the top of the segment, followed closely by white wine, sparkling wine and fortified wine. Chateu Indage, Grover Wines and Sula Wines are some of the key players in this segment.

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