Tariffs and the Future of Wine in India according to Rajeev Samant

For twenty two years, Sommelier India has had a front row seat to the evolution of the Indian wine industry. When we began, Indian wine was an idea filled with promise. Over the past two decades, we have watched that promise mature into a category with real scale, structure, and ambition. No company has been more central to that story than Sula Vineyards.

This conversation took place over Zoom, with Shiv Singh, Publisher of Sommelier India, speaking from his primary residence in the Bay Area outside of San Francisco, barely twenty minutes from Stanford University, where Rajeev Samant studied economics and engineering. Rajeev joined from Mumbai, reflecting on trade, tariffs, premiumisation, wine tourism, exports, and what the next decade may hold for Indian wine.

Rajeev, good to catch up. Before we dive into tariffs, you mentioned on email you may be back in the Bay Area in the next year or two. If that happens, we should do a proper wine dinner this side.
That would be wonderful. It gives me a little extra incentive to make the trip. I miss old friends in California, and there are grandkids in the family now too, so fingers crossed.

Consider it done. We’ll make it a real gathering. Now, let’s switch gears. From your perspective, what’s the headline on the EU-India tariff conversation?
The big picture is simple. If the wine category grows, everybody benefits. Some may benefit more than others, but growth helps the whole ecosystem far more than no growth or degrowth. And candidly, wine has had a tough year and a half in India. Globally too, but India has not been immune.

If we fast-forward five years, what’s the ideal state for the Indian wine scene from a consumer standpoint?
I think we’ll see a more active, more energized market, especially at the higher end. But to understand where we’re going, it helps to ground it in how the market actually works today. Distribution is still the central constraint. There is no plug-and-play national distributor for imported wines. For imports especially, you have to build distribution one city, one district, one state at a time.

That’s a reality many outside the industry underappreciate. When people talk about tariffs coming down, they assume the market changes overnight.
Exactly. It’s a slow burn. The tariff story is real, but distribution and execution determine what actually happens on the ground.

So how does that play out for Sula specifically?
For us, distribution and brand work together. You need both, and we’ve built both over time. We have strong distribution in key markets, and we’ve invested in wine-specific selling and education for decades. Wine is not spirits. It’s not just about pushing cases. It’s hand-selling, it’s relationships, it’s consistency, and it’s trust.

When you say consistency and trust, you’re pointing to quality and reliability.
Yes. When someone buys a Sula wine, or one of our Source wines, they know the quality will be right. They know availability will be there. They know their consumer will be happy. That matters hugely in a category where no two wineries are the same, and where imported supply can be inconsistent.

Let’s talk about where tariffs will matter most. What do you expect to happen at the premium end?
The biggest benefit will come to the most expensive wines. There’s a growing number of high net worth Indians who love iconic wines. In my experience, Super Tuscans and Napa Cabernets tend to dominate the conversation, often even ahead of Bordeaux. As tariffs come down, prices for those iconic bottles should fall meaningfully, and I expect a dramatic increase in domestic sales.

Dramatic as in?
Over a few years, it could be multiple times, potentially up to ten times for some of those labels. And it won’t be limited to one channel. You’ll see it in both on-trade and off-trade. Top restaurants already list these wines. Once pricing becomes more accessible, people will celebrate with them more often. Retail will benefit too.

And do you see Indian wines competing in that ultra-premium tier?
Not realistically in the near term. I don’t see Indian wine competing in that segment for at least another decade. People always ask why we don’t launch a five-thousand-rupee wine. But price point and category structure matter. The bulk of imported wine volume in India still comes in at very low CIF levels. The premium iconic tier is a different game entirely.

Where does that leave Sula’s import strategy through Sula Selections?
We would absolutely consider leaning into premium imports as that segment expands. It makes rational sense for us. We already have wine distribution and a wine-trained sales organization. We’re used to hand-selling and operating at smaller volumes than spirits companies. Our own brands will always be our core, but as a public company you also have to grow the top line and profit. Selective imports can be a logical add-on.

What about the mid-tier? The price bands that matter most to the Indian consumer today?
You have to define “mid-tier” carefully. In imports, mid-tier might mean three to six thousand rupees a bottle in Maharashtra. That segment should grow. You’ll see stronger demand for wines like Chianti Classico, Côte d’Or styles, and some California brands as the market broadens. But it’s still a small slice of the overall category.

So the mid-tier grows, but doesn’t reshape the mass market overnight.
Correct. The big structural change is at the high end. The mass market is still defined by affordability, domestic capability, and distribution.

One question I keep coming back to is whether a more premium import market changes consumer behavior overall. Does it pull people up the value chain?
I believe it does. More premium brands entering will create more activation. More dinners, more tastings, more trade engagement, more institutional push from export bodies. That creates buzz, and buzz grows categories. The burden of growing the wine market in India has often fallen on domestic producers, especially Sula. Increased premium activity will help build the overall culture.

That cultural flywheel could have knock-on benefits for wine tourism too.
Absolutely. And wine tourism is something imports cannot replicate. For domestic players, that’s where the long-term advantage is. For Sula, it’s a huge edge.

Let’s go there. What are you seeing in wine tourism right now?
The demand is strong and still rising. We’ve built an experience with real professionalism and a heavy emphasis on wine. Visitors can get wine at MRP across the property, there are wine corners everywhere, and the hospitality experience is designed around the category. That creates deep brand connection. When you have hundreds of thousands of visitors experiencing your wines firsthand, that’s an advantage few can match.

How large is the business now?
Wine tourism is the growth engine. We’ve expanded rooms significantly over the past year, and occupancy has held strong even as capacity increased. Footfalls have rebounded as well. Infrastructure improvements help too, better flights, better roads, better connectivity into Nashik. People are traveling for domestic leisure, and wine tourism fits perfectly into that shift.

Does that shape your investment priorities?
Yes. We don’t need to invest in production capacity the way we did a few years ago. The market has been fairly stagnant for the last couple of years, so we’re in a wait-and-watch mode on production expansion. Most of our capex focus over the next few years will be wine tourism. That’s where the momentum is, and that’s where we can keep improving the experience.

Coming back to tariffs, there’s another variable people underestimate: currency.
Exactly. The forex effect matters a lot. Over the last year, the euro has strengthened significantly against the rupee. That alone reduces the panic factor because even if duties fall, currency moves can offset some of the impact. If the euro continues appreciating, EU wines can still price themselves out of reach for many consumers, even with tariff relief.

So it’s not just tariff arithmetic. It’s tariff plus FX.
Correct. And as long as India remains a major oil importer, it’s hard to see the rupee strengthening meaningfully. Global shocks show up quickly in the import bill. So yes, tariffs matter, but currency can be just as consequential.

Does that influence how you price and manage your portfolio?
It does. It affects where we hold pricing, where we look for efficiencies, and how we think about competitiveness. We need to keep getting leaner and sharper. Coming out of COVID, there were distortions, supply chain issues, and unusual dynamics that made the market feel like it was accelerating faster than it really was. Now the focus has to be sustained execution.

Let’s talk about quality. As consumers get more discerning, do you feel more pressure?
Of course. If you stand still in any business, you get left behind. Our quality has improved dramatically over time, but price points matter. You can always spend more, new French oak, longer aging, different choices, but it costs money. The question is how to keep raising quality while staying in the sweet spot of value.

Are you confident you’re positioned well for that next phase?
Yes. We’re ready for the moment, but we still have to work. People will trade up, and some consumers who buy our higher-end domestic wines today will also explore premium imports. That’s natural. We’re okay with that. The goal is to keep improving, stay lean, and continue delivering quality and reliability at our price points.

One final theme. What do these shifts mean for Sula on the international stage, the UK, the US, and other markets?
We do have to get more aggressive with exports, but it’s hard. Traditional wine markets are shrinking. The US is shrinking. China has fallen dramatically from its peak. You also have intense competition because small wineries in Europe are fighting for survival. The cost of showing up at major trade fairs is very high in rupee terms, and breaking through with Indian wine is a long road.

So exports are strategic, but not a quick win.
Exactly. We’ll keep working at it, but it has to be targeted and pragmatic. We’re a million-case company. The export story has to be meaningful, not vanity. The real growth, near term, is still about building the Indian market, expanding wine culture, and deepening wine tourism.

This has been incredibly insightful. Thank you for your candor and for walking through the real mechanics behind the headlines.
My pleasure. And when you’re next in India, you have to come to Nashik. See it firsthand. It’s always better than taking my word for it.

Done. I’m overdue, and I’ll be there.
From a Zoom screen bridging Mumbai and the Bay Area, this conversation underscored how much the Indian wine industry has evolved and how many variables still lie ahead. Two decades ago, Sommelier India was watching the category take shape. Today, with tariffs, currency, premiumisation, and tourism all in play, the road ahead looks more mature but no less dynamic.