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Multinationals' Double Standards: Healthier Foods for Wealthy Nations, Says New Report

Recent reports reveal that several major food and beverage corporations, including Nestlé, Unilever, and PepsiCo, are selling products with reduced nutritional value in low- and middle-income countries, such as India, while retaining healthier versions for high-income markets.

• By Pooja Chaturvedi Sah
• New Delhi
• Nov 12, 2024

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India’s diet is undergoing a seismic shift, driven by rapid urbanization, busier lifestyles, and the appeal of convenience foods. But as international food giants flood the market, a troubling trend has emerged: multinational companies are allegedly offering lower-quality, less healthy products in India compared to wealthier countries. 

Recent reports reveal that several major food and beverage corporations, including Nestlé, Unilever, and PepsiCo, are selling products with reduced nutritional value in low- and middle-income countries, such as India, while retaining healthier versions for high-income markets. 

This troubling discrepancy raises questions about the accountability of these global corporations and the role of regulatory bodies like the Food Safety and Standards Authority of India (FSSAI) in protecting consumers. 

Selling Unhealthier Products in Low-Income Countries: A Double Standard? 

The Access to Nutrition Initiative (ATNi) recently released a report comparing product health ratings across 30 food and beverage companies in various markets. It found that products sold in low-income countries like India often score lower on health scales than the same brands offered in wealthier nations. 

Using the Health Star Rating (HSR) system—where a score of 3.5 or above is considered healthier—the average rating of products sold in low-income countries was a mere 1.8 stars, compared to 2.3 stars in high-income nations. 

In India, companies like Unilever, Coca-Cola, Mondelez, and PepsiCo derive significant revenue from products that fall short of the ATNi’s recommended health standards. While these brands derive 11–38% of their sales from “healthier” products in India, this is well below the global target of 50% set for 2030. 

Mark Wijne, ATNi’s research director, highlighted the ethical implications of this disparity, urging governments to take a more proactive role in regulating these companies and ensuring better quality for consumers in lower-income countries.  

The Scale of the Problem: Processed Foods as a Growing Threat in India 

The ATNi report isn’t alone in raising alarms. A 2019 study by the University of Oxford ranked India at the bottom of the list of 400,000 analyzed food and drink products worldwide, giving India an average health rating of just 2.27 compared to the UK’s top score of 2.83. This finding underscores India’s high levels of saturated fats, sugar, and salt in packaged foods. 

The market data is equally concerning: sales of processed foods in India nearly doubled between 2012 and 2018, from $31.3 to $57.7 per person. WHO reports reveal that from 2011 to 2021, retail sales of UPFs in India grew at a compound annual growth rate of 13%, with sweet biscuits alone accounting for 43% of market sales in 2021. 

Unpacking Multinational Practices: Disparities in Food Ingredients by Country 

It’s not only lower nutritional ratings but also lower-quality ingredients that mark the products offered in India. A stark example is Nestlé’s Cerelac, a popular baby food that includes added sugar in its Indian formulation but not in Europe, where babies under two years old are generally not recommended any added sugars. Similarly, PepsiCo’s Classic Salted Lays in India uses palm oil—a cheaper but less healthy fat—whereas the same product in the U.S. is made without it. Such discrepancies are not isolated. Kit-Kat, for instance, contains only 16.2% milk and 4.5% cocoa in India, compared to 25% milk and 22% cocoa in Australia. 

These examples illustrate a pattern where big brands compromise on ingredients in markets with less stringent regulations, raising ethical and health concerns. 

Ultra-Processed Foods and India’s Health Crisis 

India’s rapid urbanization and changing lifestyles have fueled a shift from traditional diets to processed foods, particularly among urban and middle-class households. Studies suggest that even in rural areas, UPFs are becoming more accessible and affordable, driving changes in eating habits. 

According to a 2020 Lancet study, Indian households now derive more calories from processed foods than from fruits, which significantly shifts dietary patterns. This trend correlates directly with rising obesity rates. 

Between 2019 and 2021, India’s National Health and Family Survey reported an increase in overweight children under five from 2.1% to 3.4%. The World Obesity Atlas 2023 further predicts that childhood obesity in India will grow at a compound annual rate of 9.1% from 2020 to 2035. In adults, obesity is expected to rise by 5.2% over the same period. 

Labeling and Consumer Awareness: The Lack of Transparency 

India’s food labeling standards lag far behind those of countries like the U.S. and Australia. Although the Foods Safety and Standards Authority of India (FSSAI) proposed front-of-pack (FoP) labeling in 2018, the regulation has yet to be fully enforced. This delay has hindered consumers’ ability to make informed choices, allowing multinational companies to market foods with high sugar, salt, and fat content without clearly disclosing their nutritional drawbacks. 

In a 2023 study published by ScienceDirect, the analysis of 230 food packages in India revealed widespread use of vague claims such as “natural” and “nutritious,” often with little regulatory oversight. Furthermore, many high-sugar and high-fat foods carried claims that are legally prohibited or fail to meet FSSAI standards, creating a misleading landscape for Indian consumers. 

These examples suggest a troubling trend where multinationals cut costs by offering lower-quality products in countries like India, where regulatory oversight may be more lenient. 

The Push for Policy Reforms: Regulatory Gaps and Industry Influence 

The ATNi report calls for stronger regulatory action to close the health gap between products sold in low- and high-income countries. With over half (52%) of households in LMICs struggling to afford nutritious food, the United Nations’ Sustainable Development Goal (SDG) of ending malnutrition by 2030 seems far from reach. 

In response, several Indian public health organizations are urging the government to tighten food safety standards and implement stricter advertising restrictions. 

A 2024 Lancet study, for instance, found that among nine countries with policies aimed at restricting food marketing to children, only one had restrictions across all media. This study called for India to restrict all HFSS food advertising, especially during prime time when children are exposed. 

What Lies Ahead: Building a Healthier Food System in India 

For India to tackle its growing health crisis, a comprehensive approach is essential. The FSSAI must rigorously enforce food standards, ensuring multinational companies do not exploit regulatory gaps. 

Our journey towards a healthier food environment requires more than just policies; it demands accountability from corporations and vigilance from regulatory bodies. The food industry’s double standards in offering lower-quality products in low-income countries can no longer be overlooked. 

At the same time, consumers deserve transparency and should be empowered to make informed choices about what they eat. Unless stringent actions are taken—both by enforcing stronger food standards and promoting consumer education—India’s processed food crisis may only worsen. With health outcomes on the line for millions, this is an issue that deserves urgent attention and coordinated effort from all stakeholders.