The consumption pattern of the Grape wine in India has been growing rapidly thus, it is a huge opportunity for young entrepreneurs to try their hands in the Grape wine production business.
Grape is the commercial fruit crop of the peninsular part of India that is a member of the Vitaceae family. Amongst the major producers of Grape in the world like China, France, Spain, Italy, and the USA, India ranks 5thamong the top 10 grape-producing countries of the world. India produces about 1.21 million Tonnes of grapes that is majorly contributed from Maharashtra, Karnataka, and Tamil Nadu.
Grape wine is the most popular fruit wine all across the globe, and it is gaining more popularity with time, in India. Grape wine is the fermented juice of grapes that are converted into fortified wines having alcohol content from about 14 percent to 30 percent.
The Grape wine market in India is growing rapidly, as they are now easily available in supermarkets, malls, and also through online delivery at the customer’s doorsteps. With the increasing popularity and global awareness about the wines, the Indian wine market is growing rapidly due to the steady demands for Indian wines in the International market across the globe. Thus, India provides a huge market for young entrepreneurs to try their hands in the Grape wine production business.
Reasons for Growing Grape Wine Production Business in India
The Grape wine production business in India has witnessed a growing trend in the past years due to the availability of high-grade wine at a cheaper rate in India. Due to the more informed consumers, they are now aware of the difference between the good quality and bad quality wines have also helped the Grape wine production business in India to a large extent. The Grape wine production business in Maharashtra’s Sangli and Nashik District has grown rapidly producing about 94.79 lakh liters of the total 1.04 crore liters Grape wine produced in India.
Another reason for the increasing popularity of the Grape wine production business in India is the availability of wide varieties and taste of the grape wines due to different climatic variations, soil textures, and viticulture practiced in India. Not only the high-income groups but the Indian grape wine production business has reached the middle-income groups to have pushed the Grape wine industry greatly.
Process in Brief
Following are the process of the Grape wine production business-
Step 1- Harvesting
The first step towards making the grape wine is the use of the Harvesting method. The harvesting method is dependent upon factors like one has to make still table wine or sparkling wine. The sparkling wine requires more acid as compared to the table wine. Therefore, it is important to balance the concentration of the sugar and acidic contents of the grape wine accordingly. The examination of the samples of the grape wines is conducted by tracking the pH level and acidity at regular intervals of time. The grape wine is harvested when they reach their optimum composition.
Step 2- Crushing
Before crushing the grapes for the grape wines, a solution of Sulphur dioxide is added to the crusher. The de-stemming of the grapes takes place by the beathers before they are passed through the rupture. The grapes are then crushed and rolled to make the grape juice which is then protected by a layer of Carbon dioxide to prevent it from the air. If required, the traces of Sulphur dioxide are added to the juice to balance the molecular level of SO2 at 80ppm.
Step 3- Pressing
After crushing the grape berries, the juice is segregated from the crushed part and squeezed gently. The squeezed juice of the grape is left overnight to settle down and an enzyme named pectolytic enzyme is mixed and finally, the pulp is squeezed that is used for preparing grape wine.
Step 4- Fermentation
Choosing the wine yeast is the most important step for the fermentation process that causes a reaction series converting the fructose and glucose present in the juice into ethanol. An anaerobic reaction then takes place that helps in converting the ethanol further into H2O and Carbon dioxide. Therefore, the fermentation process is performed with the use of Carbon dioxide that helps in increasing the level of the Grape wine production business.
Step 5- Purification
Purification is the final process of grape wine production, where the wine is precipitated out with the help of gelatin or bentonite that helps in maintaining the pH level of the wine. The two methods are used for the purification of the grape wine namely; fining and racking. The sedimentation of the grape wine takes place resulting in the separating of wine that is crystallized at 0 to -30degree temperature for about 10 to 14 days.
Legal Observance for Grape Wine Production Business
A large-scale Grape wine production requires various licenses and Governmental registration.
Before, starting a Grape wine production business, one must obtain the following legal observance-
- Registration of VAT and Excise.
- ROC Registration
- ISI Mark BIS Certificate
- State and Central Government permission
- FPA and FPO Certificate
- Brand Registration with Trademark
Investment and Cost of production
An investment varying from Rupees 4 crores to 8 crores per 10, 00,000 Liters of a grape wine is required for setting up the Grape wine production business along with various other investments including plant, machinery, land, building, and working capital. However, an investment of Rupees 1.2 crores and 2.5 crores is required for setting up the cheaper quality wine production unit. Various financial assistance is provided by NABARD while APEDA assists in exporting the grape wines outside of India in the global market.
Machinery and Plant Setup
Following machines are mainly required for the Grape wine Production Business-
- Screw type juice extractor
- Boiler
- Steel washing containers and jet washing system
- Hydraulic press (Rack and cloth) 5 tonnes pressure cap with 2 trays and 2 racks
- Filter press
- Fermenter with cooling and heating systems
- Air condition
- Semiautomatic bottle washing plant
- Automatic bottle filling and crown corking
- Empty Carbon dioxide cylinder
- Yeast culture room
- Steam Pan Tanks
- Carbonator
- Maturity tanks
- Oakwood barrels
- Miscellaneous- knives, wood tables, trays, crates, baskets, weighing machines, etc.
Tips for Starting a Successful Grape Wine Production Business
Step 1-
The first and foremost step that is required to set-up a Grape wine production business is to determine the type of wine production unit you will have to establish. Various questions like ordering the grapes from outside or growing your grapes have to be addressed. And if you choose to grow the grapes on your land, you must carefully buy the potential lands with suitable climatic conditions and soil. Choosing the right type of land with the perfect location for the grapes is the most important step for starting the Grape wine production business.
Another important step after securing the suitable land for the Grape wine production business is planning a retail business model and to obtain a small business loan for that purpose.
Step 2-
Following details must be considered if you want to grow the grapes on your land for setting up a Grape wine production business-
- The climatic conditions of your land on which grapes are to be grown must be analyzed properly to avoid the grapes from the extreme weather conditions.
- The grapes require slopes in the South direction together with perfect weather conditions.
- Another step is to choose the most suitable type of soil for growing the best quality grapes on your land. More acidic soil is the most suitable soil for grapes that is low in nutrients.
- The planting of the grapes must be done at least 4 to 6 feet away from each other to avoid shade on one other.
- Choosing the variety of vine that you will have to produce is also an important step. One must opt for a wine that thrives best on your land together with the weather conditions.
- The wine must be at least more than a year old and certified.
Step 3-
Selling the Grape wine is ultimately the most important step of the Grape wine production business; keep the following details in mind-
- The marketing of your grape wines must be started at a more early stage since the grape wine market is competitive. A unique branding of the Grape wine will positively affect your Grape wine production business to a great extent.
- Another important step is to fulfill all the legal requirements of your State including the paper works and obtaining the licenses required for setting up a Grape wine production business.
- Distribution of the wine is also required for the proper transportation and selling of the grape wines in remote areas.
Customs Duty and Excise Duty
- The customs duty on the Grape wine is increased from 100 percent to 150 percent.
- In 2007, the education cess applied to wine imports has been scrapped.
- The excise duty that has been levied on the wines by the government is waived off now.
Local Tax
- As per the Central Government’s prescription, the maximum State Excise duty levied on the Grape wine is 25 percent.
- The Import fee rate in the state of Kerala is Rupees 2 per Bulk Litre.
- The Maharashtra Government has waived off the Excise duty on Grape wine.
- The Excise duty for Grape wine has been reduced from Rupees 32.25 per liter from 20.50, by the Haryana government. The Haryana Government has reduced the export duty on the wine for boosting the domestic industry of the grape wine.
VAT (Value Added Tax) on Grape Wine Production Business
- Maharashtra- 20 percent
- Delhi- 20 percent
- Haryana- 20 percent
- Chandigarh- 4 percent
- Karnataka- VAT free
- Tamil Nadu- 53 percent
- Kerala- 12.5 percent
Government Initiatives for Boosting Grape Wine Production Business in India
Establishment of the National Wine Board
The Government of India has established the National Wine Board at Pune to meet the requirements of the International export markets. The Administrative Ministry that will be responsible for the National Wine Board and indicating its mandate will be the Union Ministry of Food Processing Industries (MFPI).
Following are the mandate of the National Wine Board-
- Promoting the co-operation among the grape growers, raisins, and wine manufacturers.
- Encourage more contact farming.
- Promoting the wine industry and its processing units.
- Promoting Research and Development and introducing new technologies for the modernization of the Grape wine industries in India.
- Develop skilled manpower for the Grape wine production business by conducting various programs and courses.
- Increasing coordination with the Research and Agricultural Universities all over India.
- Conducting various workshops and trade shows to promote the export and marketing strategies of the Wine industry.
- Produce the global standard grape wine by providing various facilities for testing the quality of the Grape wines.
- Advising the Central and State government on various policy and taxation matters.
Maharashtra Government Initiatives
- The Maharashtra government has provided a 100 percent remission to the Grape wine production business for 10 years.
- The rate of sales tax applicable to the Grape wine production business is 4 percent.
- An Octroi refund will be available to all the Grape wine producing units for 7 years or 100 percent value of the total fixed investment, whichever is less.
- No Interest subsidy is levied on the Grape wine Producing Business unit by the Maharashtra Government.
- The new Grape wine production business will be entitled to a 100 percent exemption from the Electricity Duty for 15 years.
- No Stamp Duty is levied on the new Grape wine production business.
Conclusion
Rapid Urbanization and Globalization have affected the consumption habits of the Grape wine of the people across the Globe. With the change in lifestyles, high disposable income, better standard of living, and social celebrations, people have started preferring Grape wines over other hard drinks. The value of the Grape wine production business is expected to rise and reach USD 402 Billion by the year 2023. India holds about 123,000 acres of wine yards that are capable of producing approximately 150,000liters of wines and import 20,000 of the wines in bulk. Not only there is potential in the International market for the Indian Grape wine business but also there is a huge demand in the domestic market of India.
The consumption of wines in the domestic market of India is more than 10 million liters in 2007 and it is expected to rise to 15 million liters. About 80 percent of the Grape wine demand is from the states like New Delhi, Mumbai, Chennai, Kolkata, Bangalore, and Pune.
As the Wine market of India presently standing at 4.6 million liters in terms of volume while it has grown up to Rupees 450 crores in terms of value. The Grape wine production business is more likely to grow and expand up to 15 million in the coming years.
Therefore, this opportunity must be grabbed by the aspiring businessmen to establish their Grape wine production business. Our organization Aatmnirbhar Sena has been constantly aiding the young and aspiring entrepreneurs to fulfill their dream of establishing their grape wine business. Aatmnirbhar Sena is also working with the Government and providing financial assistance and support to start-ups and young businessmen.
