|
There is nothing revolutionary in the news, which the wine producers and importers have been long waiting for-it was also an idea the government had mulled over for 3-4 years and had made statements many times that it was about to implement it. Every time it wanted to announce the policy, it was pulled back supposedly due to political expediency and it mustered courage only to allow beer retail.
With the Congress party getting stronger in both in the Delhi elections and at the center, it was expected that the policy of allowing sale of wine through the supermarkets would be soon announced-but what we got instead was an irrational increase in the excise duty-a policy that had been in fact earlier cleared by the government cabinet last year but due to inexplicable reasons was shelved for a year or so.
Beer has already been allowed to be sold in supermarkets with a license of Rs. 50,000 a year. It would make sense to make the availability of low alcohol products like beer and wine easy, especially when the neighbouring Haryana has been doing successfully for almost 2 years. Not that Haryana has been a leader in announcing this policy. Chandigarh has allowed it for more than 3 years. Goa, Maharashtra and Karnataka have followed it since.
During the last couple of years, it had become relatively easy to pick up wine from a few of the wine and liquor shops which were air-conditioned and stored only wine with a decent variety-DSIDC having taken the lead. But for women and many men it is not always conducive to walk into a liquor shop to pick up a casual bottle or two of wine. Internationally, women are known to be major buyers of wine and beer in the family and so it is a victory of sort for the women.
The other important factor is the Commonwealth games 2010 which are already giving headache to the government in terms of preparation delays. The tourism is related to the wine availability issue and the government is aware that in all alcohol consuming countries, picking up wine in a supermarket is like picking a pack of coke cans. This is one area it could handle easily without opposition this time.
The license fee is expected to increase marginally, though. But it will be dream come true for scores of people passionate enough to bring to the consumer quality premium wines which need a special knowledge, wine education and passion . The consumer in turn will not only get better quality, but more variety will be available with better options of price-quality.
Excise Duties need to be rolled back
The increase in the excise duty would still need to be brought down, at least to the original level of Rs.150, ($3) a bottle irrespective of the selling price, not because it is rational, or good for consumer or wine consumption should be increased or even because in the end, it would actually boost the excise duty collection drop that has taken place since the new excise was allowed this fiscal-but due to the latent pressure from the EU and indirectly from WTO. Earlier this month a delegation from EU was in Delhi and expressed their displeasure of the extraneous taxes beyond 150%. But before they arrived, Maharashtra had already brought the excise duties o a level where even the consumer was willing to accept.
And the Time is NOW
It is a matter of time that the government will realise the impact of increased duties resulting in lower collections, if not already under mounting pressure from the ministry of commerce to bring it down because of EU breathing on their neck. It will make sense to club the decrease in excise duty with the new retail policy.
Then only two major irritants will be left where EU cannot be help-only the sensibility will come in play. Delhi should allow opening of wine bars by reducing the license fee-it is already in existence in Maharashtra and Karnataka. The other factor would be to reduce the label registration charges. With the new wine retail policy in place, a 4-5 fold increase in labels can be expected if the registration charges are rationalised.
The producers will of course rejoice. So will the importers. Wine can be a good source of the top line as well as the bottom line-stores like Tesco and Marks and Spencer in UK are a prime example of this wine economy. Tesco, in fact rules the roost and is a trend setter in pricing, quality and value for money and has helped take the volumes of wine sale up significantly in UK.
‘Der se aaye duroost aye.’- better late than never. The Delhi government needs to be congratulated for the step and needs to be assured it is taking the correct decision.
Subhash Arora |