The Delhi High Court has put on hold a directive by the Food Safety and Standards Authority of India (FSSAI) that barred manufacturers of high-caffeine beverages from using the term ‘energy drink’ on their products, allowing PepsiCo, Monster Beverage and Reliance Consumer Products Ltd (RCPL) to continue using the label for now.
The order provides relief to the three companies, which had challenged the regulator’s directive and said the move had disrupted their operations. Similar relief was also granted to Austria-based Red Bull last week.
FSSAI had directed manufacturers of high-caffeine beverages marketed as ‘energy drinks’ to stop using the description in June, after rejecting industry efforts to hold back the move.
The Delhi HC put the directive on hold for PepsiCo and Monster during a hearing on Tuesday, following petitions filed by the companies last week. RCPL received a similar reprieve earlier on the same day. While hearing RCPL’s plea, the court questioned FSSAI’s lawyer on why the company had not been given sufficient time before the order was issued and observed that it was never too late for the regulator to correct a mistake.
The cases will be heard further in the coming weeks. FSSAI had not immediately responded to a request for comment.
The dispute has already had an impact on companies’ operations. Reliance and PepsiCo have said that hundreds of millions of products carrying the ‘energy drink’ label were abruptly taken out of circulation following the ban. State authorities also seized stocks, resulting in financial losses and affecting investment plans. In a court filing dated October 1, Reliance’s beverages arm said the action had caused substantial disruption to its business operations.
The regulatory action comes as companies look to capitalise on a growing energy drinks market in India. According to Euromonitor, retail sales of energy drinks in the country are growing at 12.6% annually, ahead of the pace recorded in the US and China. The market is expected to reach $1.6 billion by 2028.
For Reliance, the category is also part of its broader push in beverages following the revival of the Campa brand in 2023. The company has since used its retail network and pricing strategy to compete with established players such as Coca-Cola and PepsiCo.
The court’s intervention comes as FSSAI steps up its broader food safety enforcement this year, with measures ranging from raids and shutdowns to new requirements around ingredient and warning labels. The regulatory push has been accompanied by growing scrutiny of the health risks associated with junk food and other high-risk food and beverage categories.
