Preheat the oven to Gas Mark 2, 150°C, fan 130°C.
Using a knife, carefully scrape off any white pith from the orange peel. Spread the peel out on a baking sheet and bake for 3 hours, turning occasionally. remove from the oven and leave overnight to dry completely.
Arrange two 18x18cm (7x7in) squares of muslin, one on top of the other, at right angles, so the corners form a star shape. Put the remaining ingredients in the middle of the muslin, then draw the corners up around them to make a ‘moneybag’ parcel. Secure with string.
To make mulled wine, drop the parcel in large saucepan with the sugar, orange and wine. Heat through for 5-10 minutes, until just steaming, but not boiling. Serve in glasses with a slice of orange.
To make this gift extra special, present it with a couple of bottles of wine and a hand-written recipe, detailing how to use the parcel.