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Sula Vineyards Sees Limited Impact from India-EU FTA; 90% of Domestic Wines Protected
Sula Vineyards has clarified that the India-EU Free Trade Agreement (FTA) will have a limited impact on the domestic wine industry due to a Minimum Import Price (MIP) of €2.5 per 750 ml bottle. This threshold ensures that over 90% of Indian wines, which retail below ₹1,500, remain protected by the existing 150% import duty. For wines above the MIP, duty reductions are expected to be phased over 7-10 years, starting from ~75% after the first year and tapering to 20-30%. The company believes its market leadership and brand loyalty will safeguard its portfolio, with only the ultra-premium RASA range facing potential competition.
Key Highlights
Minimum Import Price (MIP) of €2.5 per 750 ml bottle CIF protects wines retailing below ₹1,500.
Import duties for premium wines to be reduced from 150% to 20-30% over a 7-10 year phased period.
Sula maintains over 50% market share in the domestic premium wine segment with 60+ labels.
Over 90% of the Indian wine market is shielded from the proposed duty reductions.
💼 Action for Investors
Investors should take comfort in the MIP protection which prevents an influx of cheap European wines. Monitor the long-term impact on the premium RASA range, but the phased duty reduction suggests no immediate threat to Sula's market dominance.