The Hindu Business Line : Favourable govt policies to boost wine industry

The Ministry of Food Processing Industry provides grants up to 25 per cent of the cost of engineering and plant and machinery subject to a cap of $1,25,000 to $1,87,500. The Ministry also reimburses 10 per cent of the raw material cost purchased from farmers subject to a ceiling of $25,000 a year for three years and a grant of $1 million for creating common facilities and infrastructure.

The State government’s Grape Processing Industry Policy offers benefits such as small scale industry status and simplified licensing procedures. Maharashtra Industrial Development Corporation has set up wine parks in Nashik and Sangli at a cost of Rs 250 crore.

The Indian wine markets is valued at $62 million and expected to grow by 25-30 per cent by 2010, according to Mr Arend M.A. Heijbroek of food and agribusiness research and advisory, Rabobank International.

The domestic annual per capita wine consumption is the lowest at 0.006 litre as compared to China’s 0.9 litres. It is 50 litres in France and Italy, 10 litres in the US and 23 litres in Australia. New Delhi, Mumbai, Chennai, Kolkata, Pune and Bangalore account for 80 per cent of the demand in the country. The lower per capita consumption provides a great opportunity for growth, said Mr Heijbroek.

Production

The bulk of India’s wine grape variety comes from vineyards of 1-2.5 hectares.

Of the 27,000 hectares under grape cultivation in India the wine variety is from 2,200 ha in Maharashtra and 200 ha in Karnataka.

“With Maharashtra government allowing contract farming, more farmers are shifting to growing wine grapes as it requires less maintenance and fetches Rs 20 to Rs 40 a kg,” said Mr Heijbroke.

Champagne Indage, Sula Wines and Grover Vineyards had accounted for over 90 per cent of the market share. However, new wineries such as Vinsura wines — a farmer group project with Vintage winery, is gaining ground. This apart large domestic producers also import and bottle wine. New entrants such as United Breweries, Diageo, Seagrams (Pernod Ricard) and Cobra are also stepping in, Mr Heijbroke said.

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