The two largest Trade Associations in the southern Indian state of Tamil Nadu have proposed a ban on the sale of Coca-Cola and PepsiCo products, highlighting the shifting dynamics in the Indian carbonates market.

The proposed ban is non-binding, and does not reflect the position of the Indian government. However, it is a keen insight into the perception of large international brands across India. The driver behind this particular proposition concerns the alleged detrimental effect to the local environment and regional producers that is caused by multinational producers. The Trade Associations claim the local water supply is severely hampered by overuse, which in turn harms local farmers who require the water to sustain their livelihoods. 

This is not the first occasion that Indian states have taken action against multinational carbonates producers. In 2006, the Indian state of Kerala banned the production and sale of Coca-Cola and PepsiCo products, after a disputed report from the Indian NGO Centre for Science and Environment which claimed the beverages contained harmful pesticides. However this ban was quickly overturned.

As an alternative to the large international brands, proponents for these bans are advocating increased support for regional producers and a renewed consumer drive for healthier beverages. This taps into the wider market trend that contributed to the 1% decline of the Indian carbonates market in 2015, which broke years of consistent growth in the country. Nine of the top ten brands failed to record growth for the year. Consumers opted for more sugar-free carbonated beverages and as a result, low calorie options saw a 25% increase for the year.

A recovery in the overall carbonates market is expected in 2016, however this will be largely driven by a surge in growth for regional products. Despite the bans failing to gain a legal foothold, the influence the movements have had on consumers has been effective. Many retailers across India continue to boycott the products as this developing trend goes from strength to strength.