New Delhi: PepsiCo and Monster Beverage have challenged the Food Safety and Standards Authority of India‘s order restricting the use of the term “energy drink” on high-caffeine beverages, escalating a regulatory dispute that is already affecting product labelling, inventory and marketing strategies across India’s beverage industry.
PepsiCo India has told a Delhi court that the Food Safety and Standards Authority of India’s (FSSAI) June 30 directive could have “grave commercial consequences” for its business and affect substantial investments in the country. The company said that, as of July 31, around 492 million bottles and 26 million cans carrying the disputed labels were in circulation.
Monster Energy India has raised similar objections, arguing that it was not given prior notice and that the regulatory action was causing financial and reputational losses.
The legal challenges come shortly after the 90-day compliance period for companies to remove the “energy drink” descriptor from affected products ended. The dispute could have wider implications for brands that have built their marketing around the energy-drink category.
What FSSAI’s order says
FSSAI’s action centres on the use of the term “energy drink” for high-caffeine beverages.
The regulator has maintained that there is no separately notified Indian standard for a category called “energy drink” and has directed companies to stop using the descriptor and similar terminology on products covered by its action. The affected businesses were given 90 days to comply.
The brands affected include PepsiCo’s Sting and Adrenaline Rush, Red Bull, Coca-Cola-backed Monster Energy, Reliance Consumer Products’ Campa Energy Drink-Gold Boost and Hell Energy.
The companies have argued that the intervention creates significant uncertainty because these products have already been manufactured, distributed and marketed under established brand identities.
PepsiCo flags large inventory
PepsiCo’s court filing gives an indication of the scale of the inventory issue.
The company said 492 million bottles and 26 million cans carrying the disputed descriptions were in circulation as of July 31. It has argued that the FSSAI directive was issued without giving the company an opportunity to present its position before the decision was taken.
For beverage companies, changing a label is not limited to replacing printed packaging. Existing bottles and cans already in warehouses, distribution centres, retail outlets and vending networks can also be affected.
Companies may consequently have to manage old inventory while simultaneously preparing new packaging that complies with the regulator’s directions.
Monster raises similar objections
Monster Energy India has also challenged the regulatory action, according to the NDTV Profit report.
The company has said it received no prior notice and has claimed that the directive has resulted in financial losses and damage to its reputation.
Monster is one of the major brands competing in India’s rapidly expanding caffeinated beverage market. The company operates in India through its relationship with Coca-Cola, while PepsiCo has built a substantial presence through Sting.
The legal challenge means that the dispute is no longer limited to discussions between the beverage industry and the regulator. Courts are now being asked to examine how the FSSAI directive was issued and whether the companies were given adequate opportunity to respond.
Red Bull has already secured court relief
The PepsiCo and Monster challenges come after a significant development involving Red Bull.
The Delhi High Court recently quashed FSSAI’s order against Red Bull after finding that the company had not been given an opportunity to present its views before the regulator took the decision. Red Bull had approached the court challenging the restriction on its use of the “energy drink” descriptor.
The ruling did not settle the broader debate over caffeine, sugar or energy-drink consumption. Instead, the court’s decision focused on the procedure followed by FSSAI.
FSSAI is expected to appeal against the Red Bull ruling, according to Reuters reporting cited by NDTV Profit.
The Red Bull case has therefore added another layer to the dispute, with the regulator facing legal scrutiny while similar cases involving other beverage companies move through the courts.
Companies had sought more time
Before the legal challenges, beverage manufacturers had sought an extension to the 90-day deadline.
According to Reuters, major companies including PepsiCo, Red Bull, Monster Beverage and Reliance had sought up to a year to implement the labelling changes. FSSAI rejected the request and maintained the 90-day compliance period.
Industry representatives had argued that the transition would be difficult because packaging changes require time and existing stock has to be exhausted or otherwise dealt with.
The regulatory deadline has therefore created a challenge for companies with large distribution networks and substantial volumes of products already carrying the “energy drink” terminology.
India’s energy drink market is expanding
The dispute comes as India’s energy drink market is recording strong growth.
Retail sales of energy drinks in India are growing at around 12.6% annually, according to Euromonitor data cited in recent reporting. The market is projected to reach approximately $1.6 billion by 2028.
PepsiCo’s Sting, launched in India in 2017, has played a major role in expanding the category. Its ₹20 bottles have particularly helped the brand reach younger consumers and buyers in smaller cities and rural markets, according to Euromonitor data cited by Reuters.
Red Bull has also established a substantial presence in the country, with its India revenue reaching $130 million in 2024, according to reporting citing Euromonitor.
With the category expanding rapidly, companies have significant commercial interests tied to the terminology used on their products.
Why caffeine content is under scrutiny
The FSSAI action comes amid broader scrutiny of beverages containing high levels of caffeine, sugar and other ingredients such as taurine.
The regulator’s concern centres on how such products are categorised and marketed to consumers. Earlier FSSAI action included notices to beverage companies over what it described as misleading claims and the use of the “energy drink” description.
The issue is also being examined by regulators internationally. England, for instance, is set to restrict the sale of high-caffeine energy drinks to people under 16 from April next year, according to Reuters.
However, the current Indian court proceedings are primarily concerned with regulatory procedure and labelling requirements. The Red Bull judgment, in particular, did not determine the broader health debate surrounding energy drinks.
What happens to existing products?
One of the biggest practical questions for beverage companies is how existing products should be handled.
PepsiCo’s disclosure of hundreds of millions of bottles and tens of millions of cans in circulation illustrates the scale of the challenge. Companies need to balance regulatory compliance with inventory management, distribution and retail availability.
The dispute also creates uncertainty for retailers and distributors holding products with the affected terminology. Any change to packaging or product descriptions could require coordination across manufacturers, wholesalers, retailers and online platforms.
The legal challenges could determine whether the companies have to proceed with the labelling changes immediately or whether courts provide relief while the broader regulatory dispute is considered.
Regulatory battle could reshape the category
The PepsiCo and Monster cases mark a significant escalation in the dispute between India’s beverage industry and the food regulator.
For companies, the issue involves established brands, large inventories and investments in packaging and marketing. For FSSAI, the matter concerns the regulatory classification and labelling of high-caffeine beverages.
The recent Red Bull ruling has added an important procedural dimension, while FSSAI’s expected appeal means the legal position could continue to evolve.
For consumers, the immediate effect is likely to be changes in product descriptions and packaging rather than the disappearance of established beverage brands. The eventual court decisions, along with FSSAI’s regulatory actions, will determine how India’s growing caffeinated beverage market is labelled and marketed in the coming months.