Since the earthquake in 2015 the Nepal food and beverage market has seen a great expansion of product offerings. There are now a multitude of whiskeys, gins, vodkas; more than several new lagers and craft beers; plus a much wider selection of wines, both imported and domestically produced.

It is reported in the Nepal business journals that over the last few years, alcohol consumption in Nepal has grown by as much as 20% year over year. Kathmandu accounts for upwards of 45 percent of total liquor consumption, though cities like Pokhara, Chitwan, Butwal, Birgunj, Biratnagar and Dharan are notably increasing.

Spirits (whisky, rum, gin, vodka, etc.) are the most consumed libations, followed by beer, while wine comes in a distant third. According to World Health Organization statistics approximately two thirds of Nepal’s alcohol consumption is spirits/hard liquor, roughly thirty percent is beer, and around five percent of alcohol sold is wine. Based on an informal survey, sales at various liquor outlets around Kathmandu roughly mirror those statistics.

Though it may seem like wine is the slightly overlooked stepchild in the cast of liquid refreshments, when we look closer at the market we see some interesting things happening.


Vita Vinum (The Life of Wine)

Wine is a fairly recent addition to the beverage market in Nepal. Historically there was no beverage similar to western wines made in Nepal, and imports only began in the mid to late 90s. Though off to a later start, Nepalis are discovering what much of the rest of the world has known for thousands of years: that wine is delicious and even has some health benefits.

Recent studies in the USA and Western Europe show that moderate consumption of wine, red wine in particular, can have some health benefits. It lowers the risk of heart disease, stabilizes the microbes in your gut, reduces the risk of breast, colon and prostate cancers, and lowers the risk of dementia. And we would be remiss if we didn’t mention the Study carried out by the University of East Anglia (UEA) and Harvard University (2016) revealing that flavonoid-rich wine acts similarly to “the little blue pill”, making wine an even better choice with dinner on your next wedding anniversary. Keep in mind that those benefits quickly go away if you drink more than a glass or two each day.


Though it is unlikely that many (okay, any) are drinking wine simply for the health benefits, we do see the market evolving, and that Nepalis are gaining an appreciation for wine in all its forms. As demand for wine has increased, we see Nepalis working hard to supply the market. Both import and domestic wine production/consumption are on the rise.


Nepali Made Wines

Domestic production is in its infancy. With no historic vineyards, most domestically produced wine is made using local fruit, herbs and honey. Local brands include Divine, Hinwa, Royal Big Master, Dadaghare, Nettlange, and Grapple. Hinwa and Royal Big Master combined reportedly now produce over 1.125M Liters annually.

Nepalese wines, as you might expect, are made with regionally available fruits. We see black grapes in the making of red wines sometimes spiced with nettles, orange and/or tea. They are described as being more similar to Port.

We also see wines made with yellow raspberries (aiselu), and Himalayan barberries (chutro), as well as, apple
nd a blend of fruits and grape. Nepali wines tend to be at the sweeter end of the spectrum, sometimes back sweetened with sugar after fermentation.

Burgeoning Vineyards

With increased access to foreign wines, the palate of the buying public is expanding. Now some selected plots of land are being dedicated to traditional wine grapes. In Chisapani, on the outskirts of Kathmandu, Pataleban Vineyard Resort has planted 20 varieties of grapes from Switzerland, Germany, France, Japan and the United States, including Merlot, Cabernet Sauvignon, and Solaris. The wines are made in a more Italian styling, versus the sweeter Nepali wines.

Based on their current success they have expanded with additional vineyards in Kaule and eventually Kewalpur. According to recent articles Big Master plans a competitive vineyard in Kavre to produce Shiraz and Cabernet Sauvignon. Pure Joy, a newcomer to the market, plans to grow grapes and produce wines in Dhulikhel with both seasonal Nepali fruits and grapes from vines imported from Switzerland.

The Nepal wine industry is small and as of the publication of this article, no government statistics were available detailing production of domestic wine. However, based on recent reports published in local business journals it appears that wine is holding its market share against other liquors. The Nepal Beverage and Cigarette Industries Association reports a 20 to 25 percent increase in domestic wine production annually. This reflects a similar increase in overall alcohol consumption. And recent newspaper and magazine reports indicate some local wineries are increasing production as much as 35% year over year.


Imported wine in Nepal

A visit to most any neighborhood liquor store reveals a multitude of imported wine. As Nepalis expand their tastes, the quantity and varietals of wine are increasing. Based on the import quantities published by the Nepal Government, import wine sales are increasing on average about 9% year over year.

2015-2016 = 820M Liters

2016-2017 = 785M Liters

2017-2018 = 941M Liters

2018-2019 = 689M Liters (1st half), estimated 1.38B Liters


There was a dip of approximately 6% after the earthquake, but sales have rebounded with an increase of roughly 20% this last year. The quantities vary some by year, but consistently Nepal’s biggest supplier is Australia providing approximately 45% of the imports. Next is Spain with roughly 30%, followed by France, South Africa and Chile rounding out the top five. We see wines from Italy, The USA, and Argentina, with wines coming from as far flung as Japan and Bulgaria, providing a truly international selection from which to choose.


Nepalis Adapt to the Import Wine

The other adaptation in the Nepal market is to produce a more western style wine by importing grapes or grape must (grape juice with or without the skins and seeds), and producing the wine locally. Companies such as Vesper and Sankata Wines import grapes and must from Western Europe and India. The wines are fermented more on the dry side of the wine tasting palate, at a price point that competes better with the locally produced wines.

This segment is growing more slowly, but steadily. Government reports show the import of wine growing approximately 5% over the last 3 years.

Must

2015-16 = 189993000 190M liters

2016-17 = 238802000 238M liters

2017-18 = 224749000 224M Liters

2018-19 = 124480 (248960000) 249M liters


En Vino Veritas (in wine there is truth)

When we review all of the data, some trends emerge. First, domestic Nepali wine growth is outpacing imports. Nepal production is growing in excess of 20% a year, while imports are growing at a rate closer to 9%-10%.

Second, imports are more popular than western style wines made locally from imported grape must. As stated, imports are growing approximately 9%-10% annually, but the import of grape must is growing at a rate closer to 5% per year.

Both are explained by an informal survey of the local liquor stores, bars and restaurants. Retailers confirmed that most Nepalis and new wine drinkers tend to prefer the locally produced sweeter wines, while expats and Nepalis who have lived overseas for an extended time tend to prefer imported wines.

The Nepali middle class is growing rapidly expanding the market for Nepali wines. While the expat community is not growing as fast, locals are gradually acquiring a taste for the dry western style wine. Foreigners and expats generally prefer wine similar to what they drink at home, now available via imports.

All combined it shows that wine has a secure place on the Nepali beverage menu. Higher end restaurants informally reported wine sales being as much as 30% of beverage sales, making serious inroads against beer and spirits.

Indeed, the Silver Mountain School of Hotel Management now maintains an oenology lab to train students on proper serving, tasting and presentation of wines. The course is mandatory as part of the degree program, and is also available to outside bar and restaurant workers. Reflecting that wine now has a permanent place in hospitality.

For those inclined to get into the business, government policy provides a tax break of up to 60% for 10 years for establishing a vineyard or winery in an under developed region, making it a prime candidate for investment.

It is safe to say that you likely will be seeing a greater variety of wines available in the Nepal markets. There is no better time to sample and find your favorite wine.