Diageo has refused to comment on local reports claiming that it is reducing its presence in the Indian wine market.

Indian press last week cited sources close to Diageo's unit in the country as saying that the firm is lining up the withdrawal of its locally-produced wine brand, Nilaya. Diageo India will concentrate its efforts more on locally-bottled spirits brands including Shark Tooth and Smirnoff vodkas, and Haig Scotch whisky, the reports said.

"The company does not want to focus on slow moving brands, and instead intends to pump in resources to develop Shark Tooth, Smirnoff and Haig," the unnamed source was cited as saying in the reports.

When contacted by just-drinks late last week, however, a spokesperson for Diageo said: "We do not comment on rumour and speculation."

Diageo launched Nilaya in November 2007, with the wine brand covering four variants - Chenin Blanc, Sauvignon Blanc, Shiraz Rose and Shiraz Cabernet. The Indian wine market has taken a hit in the last two years, however, due to the global economic climate. The local reports claimed that the wine market fell from around 1m cases in 2007 to 900,000 cases in 2008.