Despite India being the world’s third largest alcoholic beverage consumer, trade to India from the US remains small compared to other markets.
With the touch of the expert sommelier that he is, Magandeep Singh introduces the audience to the first wine of the wine tasting evening: a Sauvignon Blanc from California’s Murphy Goode. “Give it some palate time,” he exhorts, “it may seem sweet, but it’s the ripeness of the fruit.” Note the citrus flavors coming through, points out Singh of the wine.
As the evening extends, Singh takes the gathering, hanging on to his every word, through a journey of Californian wines from the Napa valley. Everyone gets a little bit of six wines to taste as Singh explains the finer notes of each wine.
A Chardonnay (Trinchero Family Estates) follows; and a Viognier (Pine Ridge), a white wine, which Singh adds, goes well with foods with a hint of spiciness. A Merlot from J Lohr Vineyard; Cabernet Sauvignon from Signorello and the wine tasting winds up with Schramsberg’s Blanc de Blancs, a sparkling wine. This wine gained international recognition in 1972 when President Nixon served the wine at the historic ‘Toast to Peace’ in Beijing, China.
The select audience was invited for the ‘California to Chennai’ evening by the US Embassy’s Office of Agricultural Affairs to promote ‘Taste of America’, a flagship campaign of the US Department of Agriculture (USDA). US Consul General in Chennai, Judith Ravin, flagged off the event.
“Showcasing California wines in South India demonstrates flourishing bilateral trade that benefits US and Indian businesses and wine enthusiasts,” she said. The event aimed to capture greater market share for Californian wines, generate enthusiasm and demand for US wines and spirits in southern India.
“India is an up-and-coming consumer of premium wines. I can not think of a better time to bring top-quality California wines to the Indian market, ”Ron Verdonk of the USDA, US Embassy, New Delhi, said. Verdonk points out that all of the wines introduced at the evening are unregistered, new to market with the objective of promoting the products to Indian importers, consumers and the HORECA segment.
With over 5,900 wine grape growers, California has one of the most fertile agricultural lands for growing grapes in the world, producing more than 80 per cent of US wine and generating $ 58 billion in annual economic activity. California is the world’s fourth leading wine producer, says a note from the USDA.
India’s alcoholic beverage sector, with a value of $ 35 billion, is the world’s third largest. India also has the distinction of being the world’s largest whiskey consumer at 1.9 billion liters in 2020. However, trade to India from the US remains small compared to other markets.
India was the 32nd largest market for US distilled spirits exports in 2021 (calendar year), which exported a total of $ 1.59 billion in 2021. For US wine and related product exports, the US exported $ 1.44 billion in the same period.
India ranked 51st in terms of market share. In 2021, US exports of wine and distilled spirits to India reached $ 6.9 million (₹ 5.98 crore), a 113 per cent increase from the previous year, according to data from USDA’s global agricultural trade system.
High import duty
These statistics provide a multitude of opportunities for US alcoholic beverage exports to India. The only crimp is the high import duties. All imports of alcoholic beverages are subject to a 150 per cent duty from all origins, apart from bilateral trade agreements.
Ask Verdonk if the US wine and spirits industry working with the Indian government, through USDA, to reduce the duties on imported wine into India, he says, “The US Department of Agriculture’s Foreign Agricultural Service help lead efforts to create more and better markets for US agriculture. USDA works with foreign governments, including the Government of India, and the Office of the US Trade Representative to establish international standards and rules to improve accountability and predictability for agricultural trade. Bilateral and multilateral trade agreements strip away trade barriers, reduce or eliminate tariffs, and promote investment and economic growth.
April 13, 2022