Jagdish Holkar, the president of the All India Wine Producers Association (AIWPA), stated, “The scheme’s revival will be a big relief for us, as it has been the bread and butter for the wine industry. It is part of a farmer-centric policy being promoted by the state government.”

As per estimates, Maharashtra wineries pay Rs 80 crore in VAT annually. Now, they are going to receive 80% of it in refunds. Sula Vineyards which is the biggest among the Indian wineries is expected to receive up to $40 crore in tax refunds annually. As the decision is being retroactively, it could be a quite a windfall for the wineries.

The Wine Industrial Promotion Scheme (WIPS) that provides incentives to wineries by returning 16% of the 20% VAT charged will be in force for the next five years. WIPS was first introduced in 2009 to encourage the wine industry in the state. The tax waiver was temporarily withdrawn in June 2020 in the wake of the financial crunch faced by the government due to successive lockdowns to contain the COVID-19 pandemic.

The Indian wine industry is relatively tiny, reporting about Rs 1000 crore in annual revenues. Maharashtra, the largest grape-producing state in India, accounting for 2.47 million tonnes in 2021-22 or 70.67% of total production, has 40-45 wineries.

Currently, wine accounts for 1% of total alcohol sales in India, but the market is expected to grow at a CAGR of 10% over the next five years.

With 29 wineries, Maharashtra’s Nashik is a major center of wine production, accounting for about 80% of the total wine produced in the state. Sangli, Pune, Solapur, Buldhana, and Ahmednagar are the other wine production centers in the state. Nashik is also coming up on the winery tourism map, with an impressive 0.35 million tourists visiting its vineyards and wineries.

Meanwhile, tourists visiting Nashik's renowned wineries over the recent Christmas and New Year holidays indulged in a staggering 2 lakh litres of grape wine, marking a 15% increase compared to the same period in 2022, a report in TOI said. This festive influx saw an estimated 35,000 visitors enjoying the scenic vineyards and indulging in wine tastings and purchases.

This rise in consumption reflects the growing popularity of Nashik as a wine tourism destination. The region boasts over seven established wineries, including popular names like Sula Vineyards, Soma Wine, York, Vallonnie, Grover Zampa, Renaissance, and Good Drops, attracting visitors from nearby Mumbai and Gujarat.

"Nashik has earned its place as the wine capital of India, and its wineries are drawing more and more interest year after year," commented Jagdish Holkar, President of the All India Wine Producers Association (AIWPA).

He further highlighted the increasing trend of festive winery visits, particularly during the last 10-12 days of December, and expressed optimism for the sector's future with a projected 20% annual growth target over the next five years. This optimism is echoed by Monit Dhavale, Senior Vice President of Sula Vineyards, who observes a growing awareness and demand for specific grape-wine brands among visitors, along with a rising interest in dedicated wine-tasting sessions.

Nashik's fertile grape-growing region boasts a significant footprint, accounting for 1.75 lakh acres out of the state's total 3.5 lakh acres dedicated to grape cultivation. Notably, 6,000 acres within Nashik are specifically dedicated to wine-grape varieties, showcasing the region's focus on high-quality wine production.

The festive season's surge in wine consumption highlights the thriving wine tourism industry in Nashik, attracting significant tourism and contributing to the local economy. As awareness and appreciation for quality wines continue to grow, Nashik's position as a premier wine destination is likely to solidify further in the years to come. (IPA Service)