it is now the second tier Indian cities that are enjoying
an unprecedented boom. Pune, riding the wave of growth
in the IT sector, enjoyed an increase of 62 percent
sales of wine in the first quarter of 2007-08, as
compared to the same period last year.
The excise records show a sale of 10,000 cases of
9 liters each in April-July in 2007 compared to 6,100
during the same period in 2006. This growth has been
achieved although the state's declared policy of allowing
wine bars to operate at nominal annual licensing fees-
not yet announced, has not yet come into play.
Pune District alone has 11 wineries. About 90% of
the Indian wineries are located in Maharashtra. Several
political bigwigs own land giving a further impetus
to the wine industry growth.
There is a good reason for this mammoth growth. Says
Vijay Chinchalkar, Superintendent of state excise
department,' A total excise waiver, i.e . zero per
cent tax, is in effect for units producing wine in
Maharashtra.' The waiver for 10 years was announced
in the special excise policy declared in 2001. The
policy had also reduced sales tax to 4% on the state-produced
wines . When the federal government shifted to 20%
VAT, this benefit was withdrawn. The producers are
paying these taxes under protest and hope to get the
current policy reversed.
This excise benefit is not available to the out-of-state
producers (Grover being the major victim of this unfair
policy), or the foreign wines. Excise duty of 150%
on the manufacturing costs or the assessable value
in case of imported wine is levied additionally to
help the local growers stay more profitable.
Bangalore based 16 year old, Grover Vineyards has
been obliged to buy and bottle grapes in Maharashtra
for its newly launched Sante range of wines-only to
save taxes. The company is scouting around for land
near Nashik to 'save taxes and make our wine competitive
in the Maharashtra market. We cannot ignore this market
although our earlier details studies spread over a
few years had shown that Maharashtra is not the best
region for growth of wine grapes of quality, 'says
Kapil Grover, Managing Director of the company.
Pune has been the automotive capital of the state.
Of late, global IT players and the top Indian IT companies
have made it an important base. The changing lifestyle
due to the advent of InfoTech companies and the personnel
engaged in it has resulted in wine gaining center
stage as the alcoholic beverage.
As of now, the Pune district has only one exclusive
wine bar 'Athena' at Narayangaon, owned by the largest
producer, Chateau Indage. But 'more are expected to
come up soon. The department has received letters
of intent from prospective wine bar promoters', adds
Other second tier cities like Ludhiana, Jaipur, Pondicherry
and Chandigarh are also witnessing similar boom.
August 12, 2007