From the Economic Times -

NEW DELHI: Wine drinkers should raise a toast to this. 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.

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,” a food processing ministry official told ET.

Sources said the ministry is 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 (PPP).