The Food Safety and Standards Authority of India (FSSAI) is working on benchmarks to set mandatory standards for nutraceuticals towards regulating the market and to also drive its growth and scalability, according to experts associated with the development.

This would further ensure that only quality and reliable products reach the consumers. They will also push the nutraceutical companies to prioritise the quality, safety and efficacy of products, whether it is at the source, manufacturing facility or storage site.

Currently, nutraceuticals are included under the dietary supplement category in one country and under food for special medical purposes in other countries. Hence, having a single, clearly defined global framework for the nutraceutical sector is required, as there is no harmonisation in nutraceutical classification and regulation across global regulatory markets.

“India is bracing up to be the leader in the global nutraceuticals market. The industry is projected to touch the $18 billion mark by 2025 and likely to exhibit 22% Y-o-Y growth. The government’s support will be crucial in driving the sector’s growth. It allowed 100% Foreign Direct Investment (FDI) in the food processing industry through the automatic route. This benefits the nutraceutical industry as the industry players can now market their products through retail, wholesale, or e-commerce platforms,” informed Ritika Jain, founder, NutraBooti.

Additionally, the FSSAI recently announced special enforcement drives to verify the compliance of nutraceuticals and health supplements. This way, the organisation aims to restrict the flow of non-compliant products, such as those exceeding the ‘Recommended Dietary Intake’ nutrient levels, containing ingredients that are not permitted and making misleading or false claims.

Talking about challenges and solutions, Jain said that as of today, nutraceuticals are charged 18% GST (with few classifications even charged at 28%), making them costlier than before when they were charged at 12%. Hence, a competitive taxation policy is required for nutraceuticals with GST rationalisation of 5% to 10% to bring them on par with pharmaceuticals. The government should further consider including nutraceuticals under the National Medicinal Plants Board (NMPB) scheme and make amendments to the Biodiversity Act as well. Steps like these will encourage backward integration in the nutraceutical industry.

Jain added that we need to strengthen our R&D systems solely dedicated to nutraceuticals to develop a progressive and innovative ecosystem. We also need to establish transparent analytical approaches with emerging technologies to ensure that quality and safety of nutraceuticals match the global standards.
With digitisation emerging at the forefront, the use of modern technologies such as Artificial Intelligence (AI), Robotic Process Automation (RPA), the Internet of Things (IoT), microfluidics, and 3D printing in the nutraceutical segment is highly recommended. For instance, AI can be utilised for demand forecasting, quick ingredient selection, and personalised nutrient formulation recommendations. Similarly, RPA can improve performance, increase product marketing, accelerate productivity, and reduce costs.

India certainly has the potential to become the global leader in the nutraceutical industry. Going by the current scenario, the country will hold a 3.5% share of the global market by the end of this year.

“Lack of regulations in the market leads to difficulty in availing subsidies. The absence of a regularised system for setting up nutraceutical manufacturing plants makes it challenging for new players to enter the market. Hence, it is high time that the industry receives government and regulatory support in the form of a legal framework. We also need to speed up the licensing process of multiple regulatory bodies, including the FSSAI, the Drugs Controller General of India (DCGI), and the Department of Ayurveda, Yoga and Naturopathy, Unani, Siddha and Homeopathy (AYUSH) in order to bring nutraceutical products to market,” Jain concluded.