FSSAI’s energy drink crackdown: Red Bull sues regulator, says label ban could bring business to standstill

India in June ordered makers of high-caffeine beverages sold as 'energy drinks' to stop using that description, ​rejecting efforts to stall the regulatory intervention in a market expected to be worth $1.6 billion by 2028.

Austrian beverage maker Red Bull has sued India's food regulator for prohibiting the use of the "energy drink" descriptor without issuing any warning notice, which it claims is impacting its investments in India, its court filing showed.

Red Bull is one of a number of globally recognized brands to have sued the Indian regulator in recent months amid an unprecedented food standards enforcement drive, which has included surprise raids and scrutiny over legal compliance impacting companies like Diageo.

India in June ordered makers of high-caffeine beverages sold as "energy drinks" to stop using that description, ​rejecting efforts to stall the regulatory intervention in a market expected to be worth $1.6 billion by 2028.

The move has triggered a standoff, as Pepsi, Red Bull, Monster Beverage and billionaire Mukesh Ambani's Reliance fear removing the ⁠category label could damage brands built around instant-energy claims, Reuters has reported.

In the first legal challenge against the move, Red Bull told the Delhi High Court on September 25 that legal processes were not followed in prohibiting use of the term "energy drinks", which is globally recognized, according to the company's filing seen by Reuters.

'Against India's policy'

Red Bull's India unit said the "abrupt prohibition" of the descriptor, without any change to the underlying product standard, "introduces substantial regulatory uncertainty and adversely affects" its existing and planned commercial investments.

The order is against India's stated policy of facilitating "international trade, promote investment and provide greater certainty to businesses," Red Bull said, adding that its "effect is to bring the petitioner's entire business to a standstill".

A government source said the Food Safety and Standards Authority of India will defend its decision in court against Red Bull, saying the FSSAI historically never allowed the use of 'energy drinks' on the label.

India's energy drinks retail sales are growing 12.6% annually, faster than in the US and China, Euromonitor estimates.

The market in India boomed after Pepsi launched Sting in 2017, with its 20-rupee ($0.21) plastic bottles proving popular among 15- to 19-year-olds, Euromonitor says. Red Bull's India revenue stood at $130 million in 2024, more than double the earnings recorded four years ago.

Energy drinks have sparked health concerns among some regulators globally who worry they contain high caffeine, sugar and taurine, an amino acid. They ​will be banned for under-16s in England ​from April next year.

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