MUMBAI (Reuters Life!) - The future of Old World wines is in emerging markets such as India, where more and more wealthy, young professionals are developing a palate for it, says Salvatore Ferragamo, scion of the Italian luxury goods group.
While winemaking in India dates back several hundred years, it is only in the last two decades that local firms have again tried to grapple with the challenge of producing vintages in a tropical climate.
At the same time, easier regulations have also opened the doors to foreign firms, making wine the tipple of choice for the growing ranks of affluent executives and young women in India.
“Countries like India are the new frontiers,” said Ferragamo, who was in Mumbai to launch five wines from the family estates.
“It’s an increasingly globalize world, so awareness is high, and demographically, as well, with young consumers and women, there is great opportunity in these markets,” he told Reuters.
Ferragamo, 37, is the grandson of the founder of the Ferragamo Company, but he was not drawn to the world of fashion, opting instead for the more painstaking process of winemaking.
He took over Il Borro, a medieval hamlet that his father chanced upon during a hunting trip, and has restored its country houses and promoted tourism to revive the village.
With a history of winemaking dating back to 1760, the Il Borro estate produces five varieties of vine, and its Il Borro, Pian di Nova and Lamelle labels command a premium over labels from New World producers such as Chile and South Africa, he said.
But he acknowledged that there was a place in the world for both the old and the new.
“Sure, I’d like people to drink only Italian wines,” he said. “But I must admit there are some fantastic wines coming from Chile, Argentina and Australia at great price points.”
Despite a steep price tag of 8,000-12,000 rupees ($160-$240) a bottle, Ferragamo said he was confident his wines will also find takers in India, better known as a whisky-swigging nation.
The Mughal kings in India were as devoted to wine as to stunning architecture, but it became fashionable during British colonial rule. Today, the wine market is estimated at about 11 million liters per year, according to Euromonitor International.
And while that is just a drop in the total alcoholic drinks market, it is growing at the fastest pace of about 25-30 percent, thanks to perceived health benefits and easier acceptance among women and youth in a society that frowns upon heavy drinking.
For both local wine producers and foreign firms, a complex regulatory framework, differential taxes and limits on the production, distribution and sale of alcoholic drinks pose major challenges, with high import duties also weighing.
Still, easing regulations and pressure from the EU to drop import tariffs holds out hope.
Liberal taxes and a salubrious climate have drawn more than three dozen wineries to set up in Nashik in western Maharashtra state, giving it the sobriquet of India’s Napa Valley.
While many of these wineries are owned by local farmers with little knowledge of wine, some local firms have joined hands with French vintners and are creating little pieces of Bordeaux and Tuscany in Nashik, with tasting rooms and stylish villas.
India’s UB Group bought French sparkling winemaker Bouvet Ladubay, while Grover Vineyards’ La Reserve was named the best “New World Red” by the influential Decanter magazine in 2005.
Still, it will be a while before Indian wines arrive, Ferragamo said.
“Wine cannot be made overnight,” he explained. “The French, the Italians have been around for centuries. Some of the Indian winemakers are seeing their first harvests. But I am sure, in time, you can make some fantastic wines.”
Editing by Miral Fahmy