Does a new government bode well for wine?

With the Modi juggernaut powering back to a thumping majority in the recent Lok Sabha elections, what does this presage for the wine industry in India?

As everybody knows, alcoholic beverages are a state subject in India – which means that every state (and Union Territory) has its own rules and regulations and duties and taxes on the stuff. Imports come under the purview of Central Customs & Excise, which since 2009 levies a Basic Customs Duty on all alcoholic beverages at 150% of Assessable Value (which is the CIF cost +1%). Star hotels and restaurants earning foreign exchange can get a “duty-free” licence, which enables them to buy spirits/beer/wine, free of customs duty – a huge saving, enabling them to charge mark-ups of 250% to 300% (which is partly why prices are so high in these establishments).

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