Government keen to encourage Indian Wine Industry

The government is working on a comprehensive policy to give a boost to wine making and its consumption in the country. The steps being considered include putting in place a uniform tax and duty regime for wines across all states, allowing its sale in departmental stores and setting up wine parks with common infrastructural facilities, says a report in Economic Times.

A committee set up by the ministry of food processing that includes excise secretaries of all states is deliberating on these issues and is expected to come up with its suggestions early next year. "The committee has already met twice and is likely to submit its report by February," accordo the report.

Ministry seems to be of the view that wine should be treated differently from hard liquor, like whiskey and rum, and preferential treatment should be given for its promotion. Therefore, it is pushing for allowing sale of wine in departmental stores. The policy has already been implemented in Maharashtra and Karnataka. The Delhi government too is likely to allow sale of wine in local stores soon.

In 1975, the Union Cabinet decided to ban creation of additional capacity for distillation or brewing alcoholic drinks, except in 100% export oriented cases. In 1997, the Supreme Court ruled that industries engaged in manufacturing alcohol for potable purposes will be under the executive control of state government. However, now the ministry of food processing is of the view that financial assistance can be provided to wine industry based on agri horticultural produce.

"The ministry has set up a National Wine Board to develop standards and promote domestic wine industry so that they may stand stiff competition thrown by Australian and French wines," said an official. Competition from foreign wines is expected to intensify with the recent reduction in Customs duties on wines and spirits.

Another reason why the government wants preferential treatment for wine is because it leads to agricultural diversification and employment generation in the rural sector. These measures could also lead to weaning people away from hard liquor and, at the same time, countering large wine imports, the official said.

The government is also working on setting up wine parks with common infrastructural facilities. One such proposal is to set up a wine park in Nandi Valley on public-private partnership.

Full report:

While the thought is certainly noble, the action seems to be slow in coming. Maharashtra has already taken the lead and the excise policy of 2001 has been something to envy about. However, in ordr to keep the quality and prices of Indian wines under check, the government must encourage a fair and healthy competition between the Indian and foreign wines. It appears from the government spokesmen that the government plans to bring back the regime of Fiat and Ambasssdor cars in this modern age of global competition. It must provide all possible support to the farmeres in terms of technology,marketing and financial support but the policies should encourage competition and improvement of the quality.

It is an open secret that the states cannot be coerced into taking the view that the government wants to take. Delhi was one of the first governments to decide allowing the supermarkets to sell wine-till date this has not been given a positive shape. By increading customs duties to 150% across the whole range has practically sealed the future of good quality wines which are not competing with the domestic wines at all and can provide a benchmark for higher quality.

However, it is heartening to note that the government has woken up to the need and benefit of promoting wine against hard liquor and any efforts and results thereof will augur well for wine consumers- editor





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