July 21, 2026
Overview:
India is facing a triple nutrition challenge. Undernutrition and micronutrient deficiencies affect many people, while obesity and diet-related diseases such as diabetes, hypertension, and fatty liver disease are also increasing.
Taxes on unhealthy foods and subsidies for healthier foods could help people make healthier choices. But these policies are not just about economics; they are also influenced by politics, industry interests, government priorities, public opinion, and how policies are designed.
This OHT collaborative study explored why nutrition-related taxes and subsidies are difficult to introduce and implement in India.
The Question:
What political, economic, and institutional factors influence India’s ability to introduce taxes on unhealthy foods and subsidies for healthier foods?
The Findings:
The researchers looked at existing research and policy documents and interviewed 18 stakeholders, including researchers, government officials, health experts, civil society groups, industry representatives, and media professionals. They found that :
- India’s nutrition policies are fragmented. Government departments often have different priorities. Revenue-focused institutions such as the Ministry of Finance and Goods and Services Tax Council have greater influence over taxation, while health agencies have a more limited role.
- Current taxes have loopholes. Some processed beverages can avoid higher tax rates because of how products are defined. For example, adding a small amount of fruit content can allow some drinks to fall into a lower tax category.
- Subsidies do not always support healthy diets. Government support is heavily focused on staples such as rice and wheat, while nutrient-rich foods such as fruits and vegetables receive much less fiscal support.
- Industry lobbying matters. Food and beverage companies have economic and political influence and may oppose policies that could reduce sales. Policymakers also must consider the impact of reforms on farmers, jobs, and businesses.
- Marketing makes healthier choices harder. Processed foods are aggressively marketed across income groups, including through affordable small packages, product placement, and advertising aimed at families and children.
- India needs policies suited to its own food system. Consumption patterns vary widely across regions and income groups, and India still has significant undernutrition alongside rising consumption of ultra-processed foods. A one-size-fits-all approach may not work.
- Public acceptance is important. People may see food taxes as unfair, particularly if healthier alternatives remain expensive or inaccessible. Using tax revenues to support nutrition programs and making healthier foods more affordable could improve acceptance.
Making healthy food the easier and more affordable choice is not simply a matter of setting the right tax rate. It requires coordinated action across government; stronger policy design; clearer definitions; better enforcement; and meaningful engagement with farmers, industry, and the public.
The researchers highlight three priorities for India– clearer nutrition-focused tax rules, stronger coordination between government institutions, and greater stakeholder and public support for nutrition policies.
Read the article in Health and Policy Planning here.
