Improved grape yields, quality get the wine flowing

Maharashtra and Karnataka appear to be leading the way as producers of high quality grapes, bringing cheer to India’s fledging wine industry. As cooler temperatures last February and March improved yields and quality, India’s wine production hit a record 17 million litres in 2014.

Industry sources said 2014 wine production estimates for Maharashtra and Karnataka were put at a new high of 14.2 million litres (1.58 million cases, at 12 bottles per case of 750 ml each). Wine from Goa too joined the list. Production estimates for fortified wine, also referred to as port wine, in Goa were placed at 3.1 million litres, at 344,000 cases, with business expanding at a fast clip.

“Maharashtra produces 75 per cent of India’s wine and table grapes, with Karnataka bringing in the remaining 25 per cent.

“Nashik, in Maharashtra, has become a big wine producing centre,'” said Ashwin Rodrigues, Founder of Good Drop Wine Cellars. “The region has the best Sauvignon Blanc grapes, a green skinned variety that originated from the Bordeaux region of France,” he said.

“Gangapur, Igatpuri, Dindori - all in the Nashik area, are famous for grapes. There are white blends, sparkling wines, and rose wines that the region is now famous for, given the many grape varieties it produces,” Rodrigues told BusinessLine .

He pointed out that the governments in Maharashtra, Karnataka and Goa have acted to support the domestic wine industry by reducing or eliminating excise duties on wines produced in the States. Fiscal incentives have been given to establish wineries and vineyards to boost production.

Exports too have soared 40 per cent year on year to touch $4.4 million for the first seven months of 2014, according to recent data. In 2013, India exported almost 1.8 million litres of wine, to reach $6.88 million, according to Ministry of Commerce figures. The first seven month of 2014 saw exports jump 20 per cent, resulting from sweeter variety wine exports to Bhutan and Vietnam.

Demand for niche Indian fruit wines — made with, for instance, lychee and mango — from new markets such as Japan is the new growth area for the wine industry.

Though export sales have grown 40 per cent by value in the first seven months of 2014 over 2013, India has a meagre 0.012 litre-per-capita wine consumption, compared to China’s one litre, Britain’s 12 litres and France’s 40 litres.

After a period of steady growth from 2000 to 2010, India’s wine production dropped 15 per cent in 2011. Though it picked up next year (in 2012) to 11.5 million litres, at 1.3 million cases, sources indicated that grape growers had shifted to alternative crops as grape prices tumbled.

According to a report by the USDA Foreign Agricultural Service, India has a number of strong demographic factors that bode well for long-term development of the wine industry, “but growth is hampered by a complex domestic system of excise, licences and fees that increase the cost of imported and domestic wine significantly, and make it difficult for small wineries to market outside of their home States.”

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