Decanter World Wine AwardsIndia a 'slow burn' for fine wine despite tax hope
- Tuesday 5 June 2012
The European Commission is pressing India to cut a 150% federal import tariff on wine as part of a trade deal, which the two sides hope to sign by the end of 2012. That would give India's emerging middle class greater access to top Bordeaux and Burgundy wines.
'One of our key requests is to see tariffs cut on alcoholic beverages, including wine,' a Commission spokesperson told Decanter.com. He declined to specify a target, but said proposals are 'ambitious'. Some reports have said the tariff could be at least halved.
However, even if a trade deal is reached, experts think India is unlikely to follow the trajectory of Hong Kong, which scrapped duty tax on wine in 2008 and has seen sales soar.
Anthony Maxwell, director at the Liv-ex fine wine index, told Decanter.com, 'India is going to be a slow burn. Hong Kong was already an established wine market, whereas India is coming off a very low base. Hong Kong also cut duties to zero, which is the Holy Grail, and I don't see that happening in India.'
Julian Campbell, assistant buyer at Diageo-owned Justerini & Brooks, added, 'India is definitely on the radar, but the market hasn't been properly tested yet.'
Wine consumption in India should reach 2.4m nine-litre cases by 2020, according to research group The IWSR.
Despite high tax, interest in high-end imported wines is growing, as shown by the Union des Grands Crus de Bordeaux hosting tastings in Mumbai and New Delhi earlier this week.
Maxwell said, 'I think India will get there, it's just going to take five to ten years, rather than two years.'
Have your say!
Prateek Arora
June 29 18:17
I can't agree more with James here.
The growth potential for fine wines in India is tremendous given that the market has grown holistically albeit in small numbers.
Where knowledge is concerned, the wine drinking community in India will soon be at par with its Western counterpart. These knowledgeable drinkers exhibit a discerning palate,as is proof in some of the recently held tastings.
Having said that,the rising middle class that is necessary for volumes, will take a little while to accept these wines but it is certainly open to the idea.An average Indian consumer is usually hesitant at first but once convinced,they embrace changes quickly. The success of large,international brands in the food business,luxury retail and automobiles are cases in point.
While an immediate comparison with China/Hong Kong comes to one's mind,it should be avoided as the two countries have very different internal dynamics.
Even if changes don't come about as drastically as HK,the wine scene in India is bound to get interesting in the coming years.
Anybody listening?
James Swann
June 06 14:34
For fine wine and wine culture interest in India is not just growing, it's tremendous.
It is not only in time scale that comparisons between India and Hong Kong are instructive. In the latter, the fine wine market has been characterised by the trading of cases of very young wines of high-end Bordeaux, any widening of demand is jumped on as a sign of maturity.
Yet, however nascent, cellars and landmark tastings in India show that maturity of taste and a willingness to experiment is already a part of Indian wine culture. The range and depth in tastings, which are usually low-key and private due to the restrictive environment, is remarkable.
In May 2011 a vertical of rare wines from 1900 – 2000 was held where tickets cost Rs350, 000 (£4, 000). In the autumn of that year Corinne Mentzelopoulos, of Chateau Margaux and Paul Pontallier, her long-serving director, presented their wines in Mumbai, Bangalore and Delhi paired with local cuisine.
It is sensible to wait until the right signs are there, but that has every possibility of being considerably earlier than 5-10 years, the time to create a market in India could just be now.
Rajesh Swarnakar
June 06 09:27
its a great news for wine lovers in India. lets hope the import duty is reduced to atleast one fourth so that common public will have access to some good wines.Go for it European commission and bring this miracle to our doorstep.