India’s wine industry is on the verge of significant expansion, with a projected compound annual growth rate (CAGR) of 20% over the next five years. Currently valued at ₹1,400 crore ($175 million), the industry is expected to more than double, reaching ₹3,500 crore ($440 million) by 2028. A report by Prowess Group highlights the growth potential, driven by increasing domestic consumption, supportive policies, and rising wine tourism.
Growth Drivers and Market Trends
Expanding Domestic Market
The Indian wine market, though relatively small compared to global benchmarks, is witnessing rapid growth. Urban consumers, particularly in major cities like Mumbai, Delhi, Bangalore, and Hyderabad, contribute to around 65% of the country’s total wine consumption. Tier II and III cities are also becoming significant markets.
Wine Tourism on the Rise
Wine tourism is emerging as a key growth driver, with companies investing heavily in vineyard experiences. Sula Vineyards, the market leader with a 60% share, is expanding its wine tourism facilities, including a 30-key resort at York Winery in Nashik by 2026. Fratelli Vineyards, the second-largest player, is also investing ₹60 crore to develop a 40-room resort in Maharashtra, aiming to increase its footprint beyond Solapur.
Regional Wine Production
Maharashtra dominates Indian wine production, contributing 85-90% of the total output, with Nashik alone covering 9,000 acres of wine-grape cultivation. Karnataka follows with a 6-7% share, while smaller regions like Himachal Pradesh, Telangana, Tamil Nadu, and Mizoram collectively cover 200 acres.
Export Potential and Global Recognition
Despite its growth, India currently accounts for less than 0.1% of global wine exports. Presently, only 2-3% of the total wine produced in the country is exported, primarily to the European Union. However, with increasing global recognition of premium Indian labels, exports are expected to rise, with key markets including Japan, the US, Turkey, Canada, the UAE, and Nordic countries.
Challenges and Policy Support
Regulatory Hurdles
One of the primary challenges in the Indian wine industry is the lack of uniform policies across states. Streamlining wine regulations will be critical for expanding both domestic and foreign investments in the sector.
Government Support
Favorable government policies, including incentives for vineyard expansion and promotional efforts for wine tourism, have played a significant role in the industry’s growth. Experts believe further harmonization of policies across states can help accelerate this expansion.
Summing Up
India’s wine industry is entering a golden phase, poised for remarkable growth. With increasing consumer interest, wine tourism expansion, and export potential, the market is set to flourish. Leading players like Sula, Fratelli, and Grover Zampa continue to innovate and invest in infrastructure, ensuring that India gains prominence in the global wine landscape.
FAQs
What is the projected growth of India’s wine industry?
India’s wine industry is expected to grow at a CAGR of 20%, reaching ₹3,500 crore ($440 million) by 2028.
Which states are the major wine producers in India?
Maharashtra leads wine production with 85-90% of output, followed by Karnataka (6-7%), and smaller contributions from Himachal Pradesh, Telangana, Tamil Nadu, and Mizoram.
How significant is wine tourism in India?
Wine tourism currently contributes 4-5% of the total market but is expected to grow at a CAGR of 25-30%.
What are the main challenges for the Indian wine industry?
Regulatory inconsistencies across states and limited export presence are the key challenges.
Which companies dominate India’s wine industry?
Sula Vineyards (60% market share), Fratelli Wines (25-30%), and Grover Zampa (7%) are the top players in the market.
