India: Domestic wine industry jittery over EU demand to reduce import duty

(TimesOfIndia) - The demand made by the European Union (EU) to reduce import duty levied on European wine by the Indian government is sending jitters through the domestic wine industry. The Indian Grape Processing Board (IGPB) fears a cut in the duty would harm the domestic industry. 

Following the EU demand, the central government is planning to reduce import duty on wine from the current 150 per cent to 40 per cent.

Maharshtra is wine country: out of a total 93 wineries in India, 75 are in the state. There are 36 wineries in Nashik, 12 in Pune, 13 in Sangli, five in Solapur, four in Osmanabad, three in Buldhana and one each in Latur and Ahmednagar. The annual turnover for the industry is around Rs 450crore, with over a crore litres of wine sold in a year. 

"If the central government reduces import duty on European wine and prices dip below the cost of production of indigenous wine, it would destroy the domestic wine industry," IGPB chairman Jagdish Holkar told TOI, "The central government must keep in the mind that the domestic industry should not be affected with changes to the import duty. The duty should be reduced only for high-end, premium wine."