Production Stopped, Stocks Pile Up: Energy Drink Order Leaves Brands Struggling

The impact is already being felt across supply chains as the Food Safety and Standards Authority of India (FSSAI) has directed beverage companies, including PepsiCo, Red Bull, Monster Beverage, Reliance and Hell Energy, to remove the phrase "energy drink" and similar descriptions from their product labels.

A source from a leading beverage company told NDTV Food, "Manufacturing of new products has been stopped but the struggle of exhausting the current stock prevails. While smaller distributors continue to buy limited quantities, for sale in dhabas, roadside stalls and kiosks, larger distributors catering to supermarkets and retail chains have become reluctant to stock products that may soon require label changes, creating a bottleneck in moving existing inventory.

According to reports, the companies have been given 90 days to comply with the directive, although requests for an extension have reportedly been rejected.

The move stems from FSSAI's position that there are currently no prescribed Indian standards for products marketed as "energy drinks". The regulator has also expressed concern over promotional claims such as "vitalises body and mind" and "helps in general weakness", stating that such messaging could mislead consumers.

As a result, beverage makers have been forced to reconsider both their packaging and marketing strategies. The directive is a significant development for a category expected to be worth $1.6 billion in India by 2028. 

Industry experts believe the issue extends beyond a single category. Ashwin Bhadri, Founder & CEO, Equinox Labs says, "This development should be viewed as part of a broader shift in how food regulation is evolving in India. For the industry, the immediate challenge is about energy drinks. However, the long-term implications could extend across multiple food categories.

As FSSAI strengthens its oversight of product claims and positioning, the commercial cost of making unsubstantiated claims is likely to increase significantly. I believe companies will need to rethink their internal product approval processes. Traditionally, marketing teams have driven product positioning, with regulatory review taking place later in the approval process. Going forward, regulatory and legal functions are likely to become involved much earlier, because the commercial and reputational risks associated with non-compliant claims have increased substantially," he adds. 

The regulatory crackdown has also led to enforcement action in some states, where authorities have reportedly seized thousands of bottles of products including Sting, Campa Energy and Red Bull. 

We have contacted other brands for their comments and are awaiting their response.