India–New Zealand wine trade enters a tariff-reduced era

By Olivia Hart

India consumes more than 24 million litres of wine a year—over 3 million cases—and IMARC valued the market at $229 million in 2024.

IMARC projects the market to reach $892 million by 2033, a 16.3% annual growth rate. Per-capita consumption remains well below global norms, leaving room for expansion as travel, rising incomes and young urban drinkers willing to trade up widen the customer base.

Wine’s role is also changing. For years, it appeared at weddings, during gifting season and on hotel bars’ top shelves, serving as a status purchase more than a taste-driven choice. Hotels and restaurants now shape discovery, while sparkling and canned formats create occasions that did not previously belong to wine.

Graham Rouse, New Zealand Trade Commissioner and Consul-General for India and South Asia, argues: “India’s next wine chapter will not be won by whoever cuts price first.” His focus is access, trust and relevance with food and celebrations, rather than short-term discounting.

What does the FTA change for hotel and restaurant operators?

Effective 20 October 2026, the India–New Zealand Free Trade Agreement phases duty on New Zealand wine down from 150% to either 25% or 50% over 10 years. It also adds a wine annex covering labelling, certification and regulatory cooperation.

For importers, the lower duty reduces one component of landed cost; for operators, it does not create an automatic margin gain. Shelf prices will still depend on logistics, state taxes and distribution costs, Rouse says. Landed cost and state excise remain the biggest levers for access, while steadier rules across states would help importers price with confidence.

Rouse says: “Its real value is predictability, which lets importers plan portfolios over a decade and not a season.” That matters for producers deciding which labels to bring into hotels, restaurants and retail, even though the agreement does not guarantee cheaper bottles.

For New Zealand, India offers scale, changing demand and growing interest in high-quality products. That makes the country a long-term market opportunity, not merely a tariff play.

New Zealand has scale, but it needs range

Sauvignon Blanc accounts for roughly 86% of New Zealand’s export volume, while Marlborough produces about three-quarters of national output. The scale gives importers a style buyers recognize, but Rouse argues the country must offer more than a single signature grape to stand out on a crowded shelf.

Gisborne, Nelson, Central Otago and Hawke’s Bay add regional breadth alongside Pinot Noir, Chardonnay and Pinot Gris. NZTE figures show that recognized sustainability programs certify 98% of vineyard area. This range supports differentiated portfolios and gives hotel wine lists more options.

Quality assurance and verifiable traceability also carry weight. NZTE research suggests consumers link the trade agreement with quality and trust rather than discounts, making identity and proof central to purchase decisions.

Distribution will determine reach

India’s state-specific licensing and excise frameworks make local expertise essential. Importers manage customs and registrations, while distributors carry wine to retailers and hospitality accounts. Industry estimates put registered importers at about 150, but only around 15 operate consistently across regions.

For New Zealand producers, selecting the right partner may matter as much as setting the right price. A distributor’s reach and relationships with hospitality buyers can determine whether a wine gains long-term shelf presence, while an importer’s state knowledge can reduce friction in landing and selling the product.

The slowdown has not closed the opportunity

Rouse characterizes the 2024-25 slowdown as a pause rather than a reversal. Sula expects a rebound this fiscal year, and the broader demand signals remain favorable as sparkling and canned wine opens new occasions.

Converting access into demand

For hospitality operators, the practical answer is to treat wine as a menu-development problem that welcomes new drinkers, not simply a lower-cost bottle. The commercial levers are straightforward:

• Access: Manage landed cost and state excise, the biggest levers on affordability, while more predictable rules across states make pricing easier.
• Discovery: Use tastings, masterclasses and staff training to give consumers a trusted guide to wine.
• Relevance: Pair wine with Indian cuisine, feature lighter and fresher styles, and build occasions around sparkling and canned formats rather than relying on price cuts.

These measures can widen the consumer base without making wine lists compete only on price. They also connect tariff relief to the food pairings and occasions that make wine relevant beyond status.

Over the next decade, the FTA gives importers and New Zealand producers a longer planning window, but commercial success still depends on sustained commitment, strong local relationships, regulatory execution and propositions adapted to Indian consumers. If those pieces align, more buyers may select wine for taste and occasion rather than status; tariff relief alone will not decide who captures the market.