Maggi back on the shelf
The two-minute Maggi noodle brand is back with a bang. Nestle India on Monday relaunched its popular Maggi noodles in India, five months after they were banned due to alleged presence of excessive lead and MSG content. In keeping with the prevailing changes in India’s consumer market, the Swiss food major has partnered with online marketplace Snapdeal for the rollout. According to Nestle India, this move has proven to be a resounding success with Maggi noodles packets sold out within minutes on Snapdeal. The product was available on the online marketplace for Rs 144 for 12 packets. In its press release, however, Nestle said that most states do not have a ban on the sale of the noodles. “For states where specific directions are required, we are engaging with them,” Nestle India said. The company has claimed that all samples of Maggi Noodles Masala have been cleared by 3 National Accreditation Board for Testing and Calibration Laboratories. For the uninitiated, these accredited labs were mandated by the Bombay High Court to conduct rigorous tests on the product. The tests have reportedly found that the lead content was well below permissible limits. Nestle’s decision to enter into a deal with the online marketplace is a clear look the future of consumer products. According to industry analysts ,the size of the Indian internet market could rise from $11 billion in 2013 to $137 billion by 2020 and the market capitalisation of these internet, businesses could touch $160-200 billion from the $4 billion at present. Despite certain obstacles, the e-commerce industry is rapidly growing on the back of rapid adoption of cheap smartphones. Also fuelling the online marketplace boom is the fact that it increasingly relies on a burgeoning industry of fast growing supporting services like warehousing, payment gateways, and logistics. This is aided by the sad reality that unfulfilled demand for consumer goods exists in India across 4,000-5,000 towns and cities, but there is no significant presence of physical retail in almost 95 percent of these towns. Nestle has decided to move along with the times.
Suffice to say, there was no conclusive evidence to prove that Maggi was indeed unsafe for consumption. Certain government-approved labs had reported that the lead content was indeed below permissible limits. However, the Government of India saw it fit to tarnish the image of the popular noodles brand, without performing due diligence. How does the government hope to attract foreign investments, when our regulatory systems are in such a mess? The FSSAI has now set down an online application process asking different food products across various companies in India to state their detailed manufacturing process, ingredients and source of raw materials for approval. They have also set an upper limit as far as the inclusion of additives such as lead or MSG is concerned. However, in spite of all the guidelines, there is no legal provision that mandates the testing of products before approval. This is only the beginning of a series of faults within the FSSAI mechanism. One of its major flaws is that once there is a notice for a ban or approval initiated, there is no system in place which ensures the smooth running of the decisions made within the FSSAI. The status of delayed approval is also one of the common complaints as far as the FSSAI’s functioning is concerned.
In spite of lifting the ban, the court has further slammed a Rs 640 crore fine on Nestle India for misleading advertisements, unfair trade practices, and false labeling. Nestle India has honoured the court, unwilling to further undergo a lengthy litigation process that has been the bane of many foreign firms. Those tests results are now out. The Maggi instant noodles brand has now redeemed itself.