PepsiCo, Monster Beverage and Reliance Consumer Products have received temporary relief in their battle with India’s food safety regulator over the use of the term “energy drink” on high-caffeine beverages, easing immediate pressure on three major companies operating in the country’s fast-growing drinks market.
The Delhi High Court on Tuesday put on hold the Food Safety and Standards Authority of India’s (FSSAI) directive for the companies, allowing them to sell existing products carrying the disputed “energy drink” label. However, PepsiCo and Monster have been told they cannot manufacture fresh products with the same description while the legal proceedings continue. The matter is scheduled for further hearing on November 5.
The dispute dates back to June 30, when FSSAI directed manufacturers of high-caffeine beverages being marketed as “energy drinks” to stop using the description. The regulator also directed food safety officials to take action against products carrying the label.
The decision quickly turned into a business issue for beverage companies, which said they already had large quantities of finished products and packaging carrying the disputed description. Removing the label or replacing packaging at short notice could mean significant costs, while products already moving through distributors and retailers could be affected.
Reliance Consumer Products was among the first companies to challenge the action. The company told the court that the FSSAI directive had disrupted its operations and put a substantial amount of inventory and packaging at risk.
Reliance said it had 168 million cans and 120 million plastic bottles of finished products carrying the “Energy Drink” label. It also had pre-printed packaging for another 400 million cans and 360 million bottles. The company said some stock had been seized by state authorities and that e-commerce platforms had been asked to remove affected products.
The Delhi High Court had earlier granted Reliance interim protection and questioned why the company had not received a notice from FSSAI before the order was passed. The court subsequently extended relief to PepsiCo and Monster as their separate petitions came up for hearing.
The order gives Reliance more breathing room for its Campa beverage business, which has become an important part of the company’s consumer products strategy. Reliance revived the Campa brand in 2023 and has since used its large retail network and competitive pricing to take on established players such as Coca-Cola and PepsiCo.
The energy drink segment is particularly important because it has been expanding rapidly in India. Retail sales in the category are growing at about 12.6% a year, according to Euromonitor data cited by Reuters, putting India among the faster-growing major markets for such beverages. The market is projected to reach around $1.6 billion by 2028.
That growth has also increased the importance of branding and product positioning. PepsiCo sells products including Sting Energy and Adrenaline Rush, while Monster markets Monster Energy. Reliance has been building its presence with Campa Energy Drink, making the labelling dispute relevant to companies competing for a larger share of the same consumer market.
The FSSAI, meanwhile, has defended its broader regulatory approach by pointing to concerns around the way high-caffeine beverages are presented to consumers. The regulator’s action forms part of a wider food safety push involving product labelling, ingredient disclosures and consumer protection. FSSAI has argued that the “energy drink” description can create an impression that caffeine provides nutritional energy, while caffeine primarily acts as a stimulant.
The companies have challenged the regulator’s approach, particularly its implementation and the potential commercial consequences. PepsiCo had earlier told the court that hundreds of millions of labelled bottles and cans were already in circulation, making an abrupt change particularly costly.
The dispute has now expanded beyond Reliance, PepsiCo and Monster. Red Bull has also received judicial relief in a separate case, highlighting the wider uncertainty facing the energy drink industry over product descriptions and regulatory compliance.
Tuesday’s court intervention does not settle the underlying question. It simply gives companies time to continue selling affected inventory while the legal challenge proceeds. The distinction between existing stock and new manufacturing is also significant, particularly for companies planning production and packaging schedules.
The outcome could have wider implications for India’s beverage industry. A final ruling may influence how manufacturers describe caffeinated drinks, how packaging is designed and how companies manage regulatory changes across their supply chains.
The immediate focus will be keeping Campa products moving through its extensive retail network without another major disruption. PepsiCo and Monster face a similar challenge as they manage existing inventory while waiting for greater clarity.
The November 5 hearing could therefore become an important point for the industry. Until then, the court’s interim relief offers the beverage companies some stability, but the larger question over how India should regulate and label high-caffeine drinks remains unresolved.
