FSSAI cracks down on misleading 'healthy food' claims, tightens noose on brands

Bengaluru | Mumbai: As the Food Safety and Standards Authority of India (FSSAI) cracks down on misleading health benefit claims by food and beverage brands, ET has found that about 85% of their digital ads run afoul of advertising norms, according to data shared by the Advertising Standards Council of India (ASCI).

Between January and June, ASCI reported that 85% of the 158 ads flagged for scrutiny required changes.

Over the past two weeks, FSSAI has issued notices to multiple brands over claims such as 'healthy', 'no added sugar', 'fresh', 'protein-packed' and '100% natural', prompting some to quickly revise their labels, packaging and advertising.


Earlier this month, direct-to-consumer (D2C) brand The Whole Truth changed its product labels to "sweetened with dates" from "no added sugar" following such a notice. FSSAI strictly prohibits the use of sugar substitutes such as date syrup, date powder, honey or fruit concentrates when claiming 'no added sugar'.

Experts said low entry barriers in the health and nutrition segment have enabled a growing number of brands to flood the market, with many products slipping through regulatory gaps.

These brands have attracted $761.4 million in funding between 2021 and July 2026, according to data shared by Tracxn. Clean-label nutrition brand TruNativ closed a $30 million deal with healthcare-focused global investor OrbiMed Advisors, while The Whole Truth raised about $51 million in a round led by Sofina and Sauce VC. Healthy snacking brand Open Secret recently raised $5.2 million from Desai Brothers Group, including institutional debt.

"Consumers have become health-conscious after the pandemic. That's why we saw the health food wave, and now we are seeing the clean-label wave. This growth is backed by VC funding because investors do not want to miss out on the trend," said a founder of a health-focused brand.

Kannan Sitaram, co-founder and partner at Fireside Ventures, said due diligence before investment is meant to assess marketing claims as well. "When we evaluate nutrition and health food startups, we verify whether the ingredients actually support the claims being made."

Misleading assertions

India's health food market, valued at $25.8 billion in 2025, is projected to reach $59.8 billion by 2034, growing at a compound annual growth rate (CAGR) of 9.79%, according to analytics firm IMARC Group.

The 'better-for-you' food segment in India has expanded rapidly, driven by rising health consciousness. To capitalise on this trend, a growing number of startups are selling protein snacks, sugar-free products, electrolyte drinks and clean-label foods.

Nutrition experts, however, say this has fuelled increasingly aggressive marketing.

"The claims attracting regulatory scrutiny are those that can influence a consumer's buying decision, though they are not adequately substantiated," said Ashwin Bhadri, founder and chief executive of Equinox Labs, a Mumbai-based food safety auditing company.

Bhadri added that recent enforcement has focused on front-of-pack versus back-of-pack communication. For instance, a 60-gram pack of 'healthy' chips says it has 10 grams of protein.

However, the per-serving amount would not account for a fraction of one's protein requirements. Experts also said that consuming large amounts of protein puffs or chips may help meet protein goals but could also result in a high calorie intake.

Another example is energy drinks. FSSAI has not issued standards for energy drinks, yet multiple brands have launched in this space claiming therapeutic benefits such as increasing focus and boosting energy levels.

Bengaluru-based nutritionist Poorvi Bhat Khandige said the ambiguity often starts with how loosely these claims are defined, such as 'no sugar'. "No sugar would only mean no white sugar," she said, cautioning that consumers who assume a product is sugar-free may end up over-consuming it without realising the cumulative calorie load.

According to D2C brand Farmley's co-founder Akash Sharma, clearer standards would push companies towards genuine innovation. "If there are clearly defined boundaries within which products must be developed, brands will have to invest in research and development to genuinely stand apart. It may take longer, but it will result in better products coming to market," he said.