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India Wine Industry Report

To the extent permissible by law the Department of State Development ND its contractors shall not be responsible or liable for any errors, omissions and misrepresentations made herein. 2 Introduction: The Indian wine market is in a nascent stage. Estimates suggest an enormous growth potential of this sector both from the indigenous wine making industry and imports. The wine market in India is mainly fuelled by the strong growth in the domestic wine production, but imported wine plays a role in creating awareness and increased demand.

Like most products in India, wine is extremely price sensitive. Market Size: As an emerging market India has great potential for nines, with an annual growth rate of 30% albeit from a low base. However, per capita consumption of wine in India is still low compared with other Asian markets. It was estimated that during the financial year 2008/9 the overall size of the Indian wine market was around 1. 2 million cases, of which 210,000 cases comprised imported product. This is small when compared with other beverage products.

For example, there are an estimated 210 million cases of spirits consumed each year, of which 100 India Wine Industry Report By ataxias drinking habits of Indians

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with higher disposable incomes, foreign tourists and sitting business people, and Government (Central and State) regulations and policies that govern the industry. Market Development: Use of the mass media to promote alcoholic beverages in the form of advertising in magazines, TV, radio, newspapers, or on street hoardings is not allowed in India.

However in-store advertising or on- premise promotions are allowed in all states except Delhi. In should be pointed out that wine shops differ widely from those in Australia. Marketing strategies have to include other forms of promotion such as promoting awareness on the relative lath benefits of drinking wine, and sponsoring appropriate events which are cost effective and targeted towards those socioeconomic groups that can afford wine. The market demands a lot in terms of creating awareness, education and demystifying wine as a product.

This can help expand the consumer base and increase demand. Companies wanting to successfully access the Indian wine market need to develop a long-term strategy that includes developing appropriate marketing promotions and educating agents, distributors and consumers about the product and the brand. Ongoing support of agents and distributors is required both on a financial basis (e. G. Supporting promotions and marketing activities) and on a personal level. Increasing awareness of wine as a separate drink other than spirits has made it more socially acceptable.

Increasing health consciousness and higher spending on corporate and personal entertainment has also given a boost to the sector. The increasing awareness of Government authorities to encourage wine drinking as compared with spirits has certainly brought cheer to the companies in the sector. The perception of inn being “market” and “sophisticated” is helping in bringing about this change. One sign of this happening is the emergence of wine clubs in a number of cities.

The biggest consumption of wine (up to 80%) is confined to the major cities, of which the largest are Mambas (39%), Delhi (23%), Bungalows (9%) and the foreign tourist 3 dominated market of Ago (9%). With the easing of quantitative restrictions on wines after April 1, 2001, there has been an increasing interest in the Indian market by international players. However the import duties and state taxes (which will be discussed later in more detail) remain high. They continue to be a major impediment to the foreign entrants into the Indian market.

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