Trade pact gain for Aussie wine
India has emerged as a focus market for Australian wine exporters with China imposing anti-dumping duties of between 116.2 per cent and 218.4 per cent on bottled Australian varieties for five years from March 26, 2021.
India has lowered import duty from 150 per cent to 50 per cent over 10 years, for bottles valued at over $5 and to 25 per cent over 10 years for bottles valued over $15 under the Economic Cooperation and Trade Agreement with Australia, signed in April 2022.
Australia has come out with a Vision 2050 for its wine industry, which has set a target to expand total exports to $10 billion by 2050 from $2.78 billion in 2019. Diversification of export markets including India is part of the strategy.
Around 40 Australian companies export wine to India, including brands such as Jacob’s Creek, De Bortoli and Penfolds, Westend Estate.
Data from the union commerce ministry shows wine import from Australia rose 64.78 per cent in the last fiscal from a year ago. Italy and France are the two major exporters of wine to India.
“There is so much that can be shared through our respective learning and experiences," said Sarah Storey, deputy high commissioner, Australian High Commission to India, at a session organised by Indian think tank Indian Council for Research on International Economic Relations (ICRIER).
“India is too big to ignore. After China imposed tariffs, Australia India Business Council saw wine export opportunity to India as a must. With the equivalent of 1.4 billion people, an English speaking business community, a democratic country with a rising middle class, it is one of the most important markets for Australia. Even though the tariffs are too high, it will reduce over the next 10 years. So, it's best to commence the long term plans and strategies now," said Con Livissianis, chapter chair — agribusiness, Australia India Business Council.
ICRIER in a report released on Thursday has urged the government to consider liberalisation of bulk wine imports.
Unless bulk wine imports are not liberalised and only finished products are allowed at concessional duties in the country, it will lead to an inverted duty structure. Moreover, permitting bulk imports at concessional duties will potentially result in greater value-addition in India.