New Delhi: The Economic Survey 2025-26 has put forward a series of aggressive fiscal proposals aimed at addressing India's escalating health crisis, with a particular focus on combating the rising tide of childhood obesity and related non-communicable diseases. The comprehensive document, presented on Thursday, outlines a multi-pronged strategy that includes significant tax reforms and regulatory changes targeting ultra-processed foods (UPFs).
Taxation and Fiscal Measures
The survey's most prominent recommendation involves moving ultra-processed foods into the highest GST tax slabs, alongside imposing additional surcharges on products containing excessive levels of sugar, salt, and unhealthy fats. This fiscal approach is designed to make these nutritionally poor products less accessible and affordable to consumers, particularly vulnerable populations.
The survey emphasizes that revenue generated from these enhanced taxes should be specifically earmarked for public health initiatives. These funds would support improvements to school meal programs and finance prevention campaigns targeting non-communicable diseases, creating a direct link between taxation and health investment.
Marketing and Advertising Restrictions
Beyond taxation, the Economic Survey proposes a potential marketing ban on ultra-processed foods between 6 am and 11 pm across all media platforms. This time-based restriction aims to reduce exposure to persuasive advertising during peak viewing hours, especially among children and adolescents.
The document also advocates for mandatory "front-of-pack" warning labels instead of complex star rating systems. Research cited in the survey indicates that direct, clear warnings are substantially more effective at discouraging consumers from purchasing unhealthy products compared to nuanced rating systems.
The Growing Health Crisis
The urgency of these proposals is underscored by alarming statistics presented in the survey. The prevalence of childhood obesity in children under five has risen from 2.1% in 2015-16 to 3.4% in recent years, representing a significant public health concern.
Projections are even more concerning: the number of children classified as obese in India is expected to surge from 3.3 crore in 2020 to 8.3 crore by 2035 if current trends continue unchecked.
Market Expansion and Consumption Patterns
India has emerged as one of the world's fastest-growing markets for ultra-processed foods, with sales expanding by more than 150% between 2009 and 2023. Retail sales of these products skyrocketed from $0.9 billion in 2006 to nearly $38 billion in 2019—a staggering 40-fold increase.
According to a World Health Organization report published in 2023, India's consumption of ultra-processed foods surged from approximately $900 million in 2006 to more than $37.9 billion in 2019. During this same period, obesity rates nearly doubled among both men and women, with the survey establishing a direct link to increased consumption of these nutritionally deficient products.
Defining Ultra-Processed Foods
Ultra-processed foods encompass a wide range of products including:
- Soft drinks and sweetened beverages
- Packaged potato wafers and salty snacks
- Chocolate, candy, and confectionery items
- Ice cream and frozen desserts
- Sweetened breakfast cereals
- Packaged soups and instant noodles
- Nuggets, fries, and other reconstituted meat products
These products are typically low in essential nutrients while containing extremely high levels of salt, sugar, and unhealthy fats. They are often referred to as "predigested" foods due to their highly refined nature and minimal nutritional value.
Cardiovascular Disease Burden
The Economic Survey reveals a grim reality regarding cardiovascular diseases, which have become the leading cause of death for both men and women in India. While men face higher mortality rates, women often experience worse outcomes due to delayed diagnosis and treatment.
The survey emphasizes that obesity is no longer confined to urban areas but has become a major public health challenge affecting both rural and urban populations. This shift is driven by increasingly sedentary lifestyles and widespread consumption of high-fat, sugar, and salt (HFSS) foods across all demographic groups.
Industry Tactics and Marketing Strategies
The document highlights aggressive industry tactics that have successfully displaced whole foods in the Indian diet. These include:
- "Buy one get one free" deals and promotional pricing
- Celebrity endorsements and influencer marketing
- Emotional storytelling and aspirational advertising
Many ultra-processed products are marketed as healthy options despite their poor nutritional profile, leaving adolescents particularly vulnerable to advertisements that create strong desires for unhealthy snacks and beverages.
Policy Gaps and Regulatory Challenges
The survey criticizes the current regulatory environment, noting that while Central Consumer Protection Authority guidelines aim to prevent misleading advertisements, enforcement remains inadequate.
A critical policy gap identified in the document involves the lack of clear, nutrient-based definitions that allows companies to make vague claims about "energy" or "nutrition" without violating established standards. This regulatory ambiguity enables manufacturers of ultra-processed foods to continue making misleading health claims without facing consequences.
Expert Perspectives and International Examples
Dr. K Srinath Reddy, former president of the Public Health Foundation of India, commented on the survey's recommendations: "The proposal for higher taxes on ultra-processed foods is timely. The rise in childhood obesity is alarming, as is the challenge of obesity-related chronic cardio-metabolic diseases. Even when adults do not meet conventional obesity criteria, excess body fat and low muscle mass lead to inflammation, reduced immunity, and increased risk of diabetes and heart attacks."
The survey cites Chile as a successful example of integrated food policy, alongside Norway and the United Kingdom, which recently banned junk food advertising before 9 pm. These international models provide evidence-based approaches that India could adapt to its specific context.
Additional Recommendations
Beyond the primary proposals, the Economic Survey suggests several complementary measures:
- Restricting school and college sponsorships by ultra-processed food manufacturers
- Enforcing limitations on marketing of infant and toddler milk and beverages
- Developing comprehensive strategies to address the broader determinants of unhealthy eating patterns
This follows last year's Economic Survey, which also warned about India's rising obesity rates and suggested implementing a "health tax" on junk food to maintain population health and productivity.
The 2025-26 Economic Survey presents a comprehensive framework for addressing India's growing health crisis through coordinated fiscal, regulatory, and public health interventions. By targeting ultra-processed foods through taxation, marketing restrictions, and clearer labeling requirements, the proposals aim to create an environment that supports healthier dietary choices and reduces the burden of obesity-related diseases across all segments of Indian society.
