Active Stocks
Fri Sep 29 2023 15:59:14
  1. Tata Steel share price
  2. 129 1.78%
  1. NTPC share price
  2. 245.65 3.3%
  1. Power Grid Corporation Of India share price
  2. 199.85 -0.45%
  1. State Bank Of India share price
  2. 598.7 1.48%
  1. Wipro share price
  2. 406.25 0.11%
Business News/ Mint-lounge / Heard it on the grapevine

Heard it on the grapevine

Heard it on the grapevine

York  Zinfandel Rose | Vintage 2008Premium

York Zinfandel Rose | Vintage 2008

Hambir Gopal Phadtare was a professor of sociology at Michigan State University in the US before he returned to India in the 1980s to take over his family land in Nashik, 180km north-east of Mumbai, in Maharashtra. He took to farming, deciding in 1996 to grow wine grape. He was among those dazzled by the appeal of a debutante industry: Indians were waking up to wine, and the state government was offering wine grape farmers generous subsidies. By 2005, Phadtare had produced his first batch of wines under Mountain View Winery Pvt. Ltd, investing more than 7 crore over a period of time.

“It was like the gold rush in the US. Everyone got on to the bandwagon," says Phadtare, now 76 and nearing bankruptcy. Earlier this year, he sold most of his 25-acre land and almost all his equipment to pay off loans. He wants to start a wine lounge and tasting room. The reason he is still in the business, he says, is because he loves making wine.

York Zinfandel Rose | Vintage 2008

As the wine atlas expands for European and American consumers, other home-grown brands are beginning to be reviewed favourably too: Labels like York, Reveilo, Good Earth, Mercury, Deccan Plateau and Big Banyan, among others, are heard of often enough.

Click hereListen to Lounge Podcast

Matt Smith, buyer for Waitrose, is certain that the taste of our wine has improved in the last few years. “I’ve been sent samples from India in the past, and the quality’s never been quite there and the price has been high too. Now, these show true varietal character," he said in interviews.

But beneath the veneer of recognition lies an industry—which got the official go ahead 10 years ago—struggling to keep its problems bottled.

Climbing vines

The Maharashtra Grapes Processing Industrial Policy was introduced in October 2001. Maharashtra hosts more than 90% of the country’s wine producers, and this first-of-its-kind regulation gave as much as 50% concessions in excise duty.

When Stanford-trained engineer Rajeev Samant quit his Silicon Valley job to set up Sula Vineyards in Nashik, it looked like the wine boom had arrived. With its first bottle out in the 2000, Sula introduced a level of quality that was previously unknown in India—and it was well-marketed. Brands like Sankalp Wines’ Vinsura and Seagram’s Nine Hills followed. Between 2005 and 2007, wine production reached an all-time high.

Ravi Gurnani, director of York Winery, which he confesses is modelled on Sula (and half a kilometre away from their winery in Nashik), says that there was a sudden deluge of winemakers. But that “the growth in the industry was more perceived than actual".

The imbalance was soon to come. There was more wine produced than there were takers, leaving a lot unsold. The surfeit of brash newcomers also meant that several did not have the necessary expertise, so the market was flooded with substandard quality. “People had bad wine for the first time and didn’t go back to it," saysGurnani, explaining the sudden fall in interest in Indian wine.

Behind the scenes: (From top) Sula Vineyards’ storage facility in Nashik, where wines are aged in oak barrels; plantation workers at Sula (MS Gopal/Mint); workers at Grover Vineyards in Nandi Hills, Karnataka (Sephi Bergerson).

Indage Vintners, a pioneer set up in 1983, even before Sula and Grover, illustrates the miscalculations that have underwritten the Indian wine story. Before it went down, Indage controlled the market. Then they made bad foreign investments, and collapsed. According to a March 2010 report on the wine news portal, sales fell to 13.8 crore in the nine months to the end of 2009, compared with 140 crore in the same period the year before. In 2009, it had total debts of about 400 crore and was issued a winding-up order by the Bombay high court.

The aftermath

The reason “wine country" Nashik wears a desolate look in the first week of October, when we visit, is because it’s not planting season yet. On the outskirts of the city, vast tracts of rain-induced green dot the land in the villages of Gangapur and Savargaon.

On a small plot in Gangapur, Dynandev Eknath Vishe guides his son to drive a tractor. Vishe has been growing cauliflower and tomato for the last three years. For nearly a decade before that, he grew wine grapes. But he uprooted his fields after another bad monsoon made his crop useless and his bank loan insurmountable. “Parvadta nahin hai(it’s not feasible)," says Vishe in a cocktail of Hindi and Marathi, when asked why he gave up. He has a family of seven whose lives, he says, cannot depend on the moods of the weather, and the vagaries of the wine trade.

Half a kilometre away, his nearest neighbour, Bhaskar Nakil, switched to table grape. His tryst with wine was shorter but similar to Vishe’s—he grew wine grape only for a year. He could not sell his produce after the local distributor went back on his word. “It’s too risky," says Vishe, “With table grapes, I can at least go to the market and sell it myself."

Vishe and Nakil are only two of the many wine grape growers in the region who have uprooted their fields in the last couple of years, switching to table grapes or other crop. According to a recent AIWPA report on the problems of the wine industry, the area under farming in India has gone down from 9,000 acres in 2008 to 5,000 acres this year.

Industry voices say that while in 2010 there was excess supply (of grapes), in 2012 there will be a shortage.

“It takes around four years after plantation for the first batch of grapes. Even if farmers were to plant now, the shortage is inevitable," says Jagdish Holkar, the president of AIWPA and the owner of Holkar Estates and Vineyards in Nashik that makes Flamingo wines.

Also Read | Message in a bottle

Half empty, half full

For this long cinematic intermission in what was turning out to be a blockbuster, insiders name a combination of factors: gullible and sometimes greedy farmers, big companies wiping out boutique wineries, different wine policies in different states, exorbitant taxes and duties and high infrastructure costs. Still, those involved believe that the second half can only get better.

York’s Gurnani believes that there will be a “correction" driven by consumers and wineries; Sula’s Samant expects a “consolidation", where fewer winemakers will produce better wine. Holkar evokes macroeconomics to call this development “backward integration"— understanding the market demand and then producing, instead of producing first and then trying to sell, which is how the industry had worked all along.

Those like Abhay Kewadkar, director and chief winemaker, Four Seasons, say the Great Indian wine boom is only waiting to take off, while Ajit Balgi, wine trainer at beverage training academy Tulleeho, thinks it will happen in five to seven years.

Even Kewadkar, however, is rueful of the Kafkaesque systems at work, taxes being his primary concern. “In any supermarket in Europe, you can buy a good wine for $5 (around 250). In India, with all the charges slapped on, we start with $10," he says.

Singh was one of those who believed. She started Sommelier India in 2004-2005, then a concept so novel that it made its way to the Limca Book of Records as “India’s first wine magazine". She started the magazine because “more and more people were drinking wine, but very few knew anything about it except for the most general clichés."

“Today there is no public event or private celebration without wine being served. The wines may not always be the best, but they’re there and consumers are more informed," Singh adds, suggesting an increase in wine awareness over the years.

“Understanding was so low when we started that even women in my book circle didn’t know what ‘sommelier’ meant. In the first few issues, we had to explain that under the edit note."

Conversations on quality and vintage have taken off, although in a small way. Singh’s husband Kulbir Singh is the vice-president of the 16-year-old Wine Society of Delhi, the oldest of a dozen such clubs. Its 215-odd members pay a one-time or annual fee to meet six to nine times a year to swivel their wine glasses and talk bubbly. There’s also more on the training and education front: academies like Vikram Achanta’s Tulleeho train those in the hospitality industry in spirits and wine.

What holds the most promise is this: Despite the lingering production hurdles, consumption has picked up again since 2009. The market for wines in India is growing at 25-30% annually according to several projections and is likely to remain so. The wine business is among the fastest growing segments of the Indian alcohol market. While in 2001, there were 20 labels; now there are close to 500 labels registered with AIWPA.

The list betrays a fair degree of experimentation too. The Haryana-based Nirvana Biosys manufactures Luca wines and the “wine-for-the young" Zoya by fermenting imported juice concentrate. They’re already out with lychee and mango wines. The Indian Ambience winery, based in Bidar, Karnataka, lays claim to organic wine under its label Yaana, which is currently only available in the south Indian states. Good Earth and Turning Point are “virtual" wineries—they outsource their winemaking to someone else and bottle under their own labels, and hence control their investments.

Spin the bottle

When Singh brings down her own bottles from her wine coolers at her Defence Colony residence in New Delhi, Grover’s La Reserve, a Cabernet Shiraz, is the only Indian label we can spot. Designed by French winemaker Michel Rolland, its inclusion is probably no coincidence. In 2005, in the year it had released, the British wine expert Steven Spurrier called it the Best New World Wine.

Spurrier is an evangelist for New World wines. If it were not for him, it would be absurd to think Indian wines could ever play the international field—or take up a greater share in a wine connoisseur’s cellar. As late as the 1970s, when it was blasphemous to serve Californian wines in France, Spurrier had a panel of leading French oenologists do a blind tasting of French and Californian wines. The Californians won hands down. A journalist from Time magazine, George M. Taber, even wrote a book about the tasting; Judgment Of Paris: California vs France And The Historic 1976 Paris Tasting That Revolutionized Wine (2005). The Judgement of Paris, as the event came to be called, would forever erode the pre-eminence of French wines.

It’s premature to think of a similar fate for Indian wines at this point. As Kewadkar points out, it’s unfair to judge Indian wines against those from European wineries with a 200-year-old tradition. “I don’t have a 50-year-old wine. If you compare both our seven-year-olds, ours are of good quality."

Ankur Chawla, Taj Mahal Hotel’s wine ( Pradeep Gaur/Mint) ;and Sula’s bottling and labelling unit in Nashik (MS Gopal/Mint)

This recognition of ground realities brings us one step closer to understanding the French obsession with terroir—the term used to denote the special characteristics that the geography, geology and climate of a certain place bestow to wine, coffee and tea. Four Seasons, for instance, chose its 300-acre vineyards in Baramati near Pune instead of Nashik, because of its unique soil and climate. Grover’s vineyards are in Nandi Hills in Karnataka, where the altitude makes the temperature relatively cooler, averaging at 30 degrees Celsius. “I try hard to respect the ‘typicity’; to give a wine the charm and consistency to be paired with dishes which are a little spicier than those from a menu from Bordeaux..." says Rolland on designing wines for India.

“The business is like a slow train," says Pradeep S. Pachpatil, senior vice-president of winery operations at Sula, borrowing a common phrase used with reference to Mumbai’s local rail network. “You will get there, but with patience."

Balgi explains that the older the grapevine, the better the quality of fruit. Other New World vineyards, in California and Australia, are at least 25 years old. For Balgi, it is only a matter of time that events such as the Waitrose juggernaut will cease to surprise. “Meanwhile, we need to familiarize wine drinkers with the unique flavour of the Indian soil," says Balgi. “Indian wine smells too ripe which overpowers delicate international cuisine—this is one of our biggest challenges. We need to campaign for this unique taste or Indian wine will always seem somewhat ‘off’ to a palate accustomed to French or Italian wine."

The problems that plague the wine industry are at every step of the supply chain. Representatives from different factions have only now come together to iron out the kinks. In 2009, the Union government set up the Indian Grape Processing Board (IGPB) in Pune in an attempt to improve the standards of wine production in India. The board consists of representatives from the wine industry, farmers, the ministry of food processing, state governments and the hospitality industry who will work together to inspect and control the quality of grape growing and wine production, approve labels and lay down standardization norms.

But for all the IGPB sets out to do, you might still be uncorking a bad bottle. As wine remains in storage in our retail conditions, it deteriorates in quality every day. “Indian wines are getting a bad reputation because even though it might be a fine wine when it left the winery, sitting in the heat on that retail shelf makes it go bad. Even restaurant staff have little training in serving a wine at its prime," says Singh.

Kewadkar draws comparisons. “In the UK and US, wine is de-licensed, so there’s better storage, visibility and consumer connect. We have it in alcohol shops where it has to fight for space with other liquor."

Winemakers spare no blame for star hotels—which would in ideal circumstances be avenues to build a connoisseur base. “Whatever the landing price of an imported wine at a retail store, a hotel gets 40% reduction because of their import duty waiver," says Navin Sankaranarayanan, chief commercial officer, Good Earth Winery. “Then when they put their markup and sell, it becomes cheaper than a lot of Indian wines. Hotels want margins and I am not blaming them because that’s how the consumer works too. They’ll think the wine is better because it’s imported."

Ankur Chawla, wine specialist at the Taj Mahal Hotel in New Delhi, agrees. “International guests are more keen to try Indian wines. Indian diners stay with the safe bets: Sula’s Dindori Reserve, Grover’s La Reserve, some Fratelli and maybe the Four Seasons," he says. After studying sales graphs, Chawla reworked the hotel’s master wine list this January: There are eight Indian wines among the 187 in the list.

Niladri Dhar, a certified sommelier who returned from New Zealand in June to join ITC Hotels as their beverage manager, is determined to change this status quo. Dhar is presently overhauling ITC’s master wine list, and says that there will be more Indian wines, especially in the wine-by-the-glass category. He is considering lesser-known names such as Globus Wines’ Miazma, and thinking of including its Chenin Blanc and Shiraz to complement ITC’s rich dumpukht cuisine. Last month, he spearheaded a 45-day training programme for staff from different ITC luxury hotels across India to take the globally recognized certification by the international Wine and Spirit Education Trust (WSET). However, WSET’s wine appreciation programme has no Indian wines on its rosters yet.

Sula’s Samant doesn’t think this is necessarily a bad thing. “Sophistication in taste does not mean moving away from us. Sometimes, it could go the other way. How old is the wine? A foreign wine might be making a six-month journey to the bar while an Indian one might make it there in a month."

Samant believes it will take three or four wine producers in India to consistently bring out great quality over the next few years before Indian wine can have its own rack in an international supermarket. He is working towards that. Sula’s Sauvignon Blanc won a silver at the 2011 Decanter World Wine Awards in the UK. It is the brightest bookmark in the Indian wine story yet.

There are good things forthcoming. Moët et Chandon will launch its indigenous sparkling wine in India early next year, for which the company has bought land near Nashik. And the first Indian wine cooler, by KAFF Appliances (India) Pvt. Ltd, hit the market in September.

Brands like “Proudly Indian" York have been winning awards right from their first vintage—first the Sommelier India top honours for its Reserve Shiraz in 2009, then a recommendation at the International Wine Challenge at the 2010 London International Wine Fair.

“Wine takes time; it can not be made with valuations in mind," says Gurnani, who has recently started selling outside of Maharashtra, in Bangalore. “It’s a labour of love. You go to a trade fair, and see thousands of great wines, and you realize how inflated your ego is as an Indian winemaker."

“There is a saying in South Africa," says Gurnani, smiling. “How do you make a million dollars in this business?

“Start with a billion."

"Exciting news! Mint is now on WhatsApp Channels 🚀 Subscribe today by clicking the link and stay updated with the latest financial insights!" Click here!

Catch all the Business News, Market News, Breaking News Events and Latest News Updates on Live Mint. Download The Mint News App to get Daily Market Updates.
More Less
Updated: 29 Oct 2011, 01:11 AM IST
Next Story
Recommended For You
Switch to the Mint app for fast and personalized news - Get App