Many cannabis strains are native to India, and cannabis is an important part of Indian and Ayurvedic culture. However, cannabis and its byproducts are banned by Indian law, although regulations do allow for hemp cultivation depending on the state. A couple of states have started growing and processing hemp for CBD but the market is still very small and there are few places to legally buy CBD.
| Population | GDP per Capita | Healthcare Spend per Capita | Cannabis Use | Average Price per 500 mg Tincture | 2021 Market Potential |
|
1.4 billion |
$2,036 |
$63 |
2.8% |
$40 |
US $2.1 million (market negligible in 2020) |
The Narcotic Drugs and Psychotropic Substances (NDPS) Act is the primary regulation that governs cannabis and hemp in India. While the NDPS bans the cannabis plant and its byproducts, the law leaves the regulation of hemp policy up to individual states. As long as states can assure the federal government and law enforcement that the plants are not being 'misused', state governments have the ability to establish their own policies on cultivation and sale of hemp.
The country's first indication of a viable hemp industry began in 2010, when the Textile Ministry passed the Natural Fiber Policy, which named the state of Uttarakhand the ideal starting point. Uttarakhand then became India's first state to allow commercial cultivation of hemp in 2017, thanks to the campaigning of local entrepreneurs eager to bring hemp products to India's health and wellness scene. The legalization was only partial though, as all farmers were required to sell their crops to the government only. Additionally, a licensing scheme was put in place, as was a limit on THC content of 3% - while this is higher than in many other countries, it is lower than the naturally occurring 4-5% THC content of the cannabis plants that grow naturally in the state.
The government of neighboring Uttar Pradesh also added the potential for a hemp cultivation industry in October 2018, when the state cabinet confirmed the creation of a licensing system. There has not been much business investment in that area, however, as regulations remain nebulous, difficult to navigate, and strict to the point of cutting off profits. The country's second largest state, Madya Pradesh, recently adopted a new policy to allow cultivation of hemp for medical and industrial purposes. Farmers must be granted a license by the state to grow hemp, and may only sell their products to the state. While the state has over 75 million inhabitants, it has one of the lowest per capita GDPs in the country, and the region is reliant on farming.
India's local state governments have chosen to legalize hemp for many of the same reasons lawmakers in the United States did so in 2018: as an economic buoy for struggling farmers. However, while political leaders stick to speaking about the plant's uses as an "industrial material", the market potential for CBD far surpasses the market potential for hemp's industrial purposes.
India is also coming around to updating some of its strict anti-cannabis laws. While cultivation of the plant remains outlawed, the country has issued a few cultivation licenses for the purposes of medical research.
The country has a unique relationship with cannabis, as the plant grows wild in much of the country and has a long history as a medicinal treatment. India's Ministry of Ayurveda, Yoga and Naturopathy (AYUSH) has even secured some exemptions for the use of both hemp plants and cannabis plants in certain practices of faith and spirituality. The country's federal court will hear a petition challenging the NDPS for its ban on cannabis products in February 2020. Although it is unlikely to succeed, this case and others like it are evidence of the growing trend towards destigmatization of cannabis in India.
India's new-found love for its age-old natural approach to medicine, practiced as Ayurveda, is bringing the use of cannabis as a medicine into the country's mainstream. This may be why consumption of cannabis (despite its illegality) is so high in Indian cities. In fact, a 2018 study by marketing firm ABCD Agency found Delhi and Mumbai ranked among the top ten cities across the world for cannabis consumption.
As stated above, some exemptions to the cannabis cultivation ban have been issued under certain conditions. Under such a license, HempCann Solutions, a company from the eastern state of Odisha, began distributing hemp-based medicines in early 2020. Because it was issued by a federal bureau (AYUSH) the company's license is not limited to one state. Customers must consult with a Ayurvedic doctor and receive a prescription to access the hemp products sold in its medical clinics. Even with strict regulations, the development of HemmCann's VediHerbals wellness center represents India's first CBD and cannabis clinic. The clinic can prescribe cannabis-infused tablets for everything from inflammation to anxiety, and the CBD and combination CBD-THC tablets range from $2.50 to $5.00 for approximately ten capsules.
One of India’s most popular personalities and Ayurveda-based medicine leaders, yoga guru Ramdev has become a proponent of cannabis medicines and treatments. His company, Patanjali Ayurved, has had enormous success selling natural health and wellness products, like soaps, and is now entering the cannabis research arena. Ramdev's vocal support of the medicinal benefits of CBD consumption and his company's entry into the cannabis and CBD market will undoubtedly improve the products' reputations in India and increase its popularity among Ayurveda practitioners.
BOHECO (Bombay Hemp Company) became the first company licensed to manufacture CBD products in India when the state government of Uttarakhand approved their application in 2018. The company makes both medicinal products, like CBD oils for arthritis pains, as well as cosmetic products, like topical creams for skin care.
The HempCann example discussed above is undoubtedly a model others will soon follow. Cannabis is widely popular in India, although still outlawed, and Ayurveda and naturopathic medicines are also widely popular and gaining in popularity as the West catches on to this traditional Indian approach to health and wellness.
The affordability and accessibility of the CBD products sold through the first clinic will encourage patient demand and likely pave the way for other clinics.
India's largest challenge for now remains the illegality of cannabis and the uncertain legality of CBD and hemp in the country. In July 2019, the Delhi High Court dismissed a lawsuit arguing for the legalization of cannabis for medical purposes, and there appears no reason to expect a change in that policy in the near term.
Contrary to other countries in the Asia Pacific region, India actually has a very high cultural acceptance of the drug and its use. Waiting for the federal regulations to catch up, however, could take long enough for the country to fall behind competitors in the cultivation of hemp and the construction of infrastructure for bringing CBD to market. Even now, the red tape and restrictions on research can take up to two years to start a clinical trial, much less finish it.
India is the birthplace of many strains of cannabis and different strains of the plant grow wild in most of the country, meaning the environment for cultivation could not be better than it is in India.
The domestic popularity of its millennia-old medicinal tradition, Ayurveda, has recently experienced a new surge and the trend is helping to bring marijuana into the mainstream.
The first clinical study held in India concluded in November 2019, with overwhelmingly positive conclusions on cannabis' palliative effects on cancer patients.