Currently, imported brands in India are required to undergo similar trials to pharmaceutical products.
Foreign cosmetics brands that develop products containing ingredients that have already been included in pharmaceutical products will no longer have to go through these research trials.
As the industry awaits an announcement from the health minister, this hopes to provide brands throughout Asia-Pacific (APAC) and the rest of the world with the ability to target the Indian market directly.
Popular products in the Indian cosmetics and beauty sector include anti-ageing and skincare solutions. As these products largely contain similar active pharmaceutical ingredients (API) to those used in traditional pharmaceutical goods, they would avoid the current restrictions and procedures imposed.
An official was quoted by Times of India as saying: "Through discussions we have come to the conclusion that such cosmetics, which contain ingredients that are already in use in drugs in India, can be given a trial waiver”.
Cosmetic products in India are regulated under the Drugs and Cosmetics Act 1940 and Rules 1945 by India Ministry of Health & Family Welfare and Labelling Declarations by the Bureau of Indian Standards (BIS).
BIS has also provided the specification for Skin Creams and Lipstick in the Indian Standards (IS) 6608:2004 and 9875:1990 respectively.
Under the Drugs and Cosmetics Rules, 1945, a license must be obtained from a Licensing Authority appointed by the State Government to manufacture any of the cosmetics classified under Schedule M-II, which includes both a license fee and an inspection fee.
At present, all cosmetic products that are imported for sale in India must be registered with the Central Drugs Standard Control Organisation (CDSCO), which has been appointed as the cosmetic industry’s relevant licensing authority.
The registration procedure also currently requires the trademark owner to obtain a registration certificate to continue with their marketing activities in India.
India’s Forecasted Growth
The annual Cosmo Tech Expo, held this year in New Delhi on 13-14 July, reported positive figures, relating to India’s growth in the cosmetics and beauty sectors.
The Cosmo Tech website states that Sourav Mukherjee, Founder of Netscribes, says that the Indian market is booming: “The beauty industry in India has evolved tremendously over the years and is expected to become a INR 170 bn market ($2.5 bn) by the end of 2020”.
Mukherjee goes on to say that this growth is driven by several key trends: “One of the dominant sectors that have been witnessing growth is the men’s personal grooming market segment. Other sectors have also seen considerable development, thereby attracting various investors to fund expansion plans of salons, spas and other institutions that provide skin and hair treatments.”
Euromonitor’s report in May 2016, entitled ‘Beauty and Personal Care in India’, suggested that industry growth slowed down in 2015 due to lowered consumer expenditure on demand for mass products.
Demand for high-end products
However, the market did experience growing consumer demand for high-end product categories, as well as improved economic conditions and decreased inflation.
Domestic cosmetic and beauty brands are still falling behind in terms of sales as international heavyweights including Hindustan Unilever, Colgate-Palmolive India, Reckitt Benckiser (India) and Gillette India foster their diverse product portfolios and deliver them to the mass market.
Euromonitor predicts that constant value growth over the forecast period (2015-2020) will be higher than during the review period. This will largely be the result of rising disposable incomes, increasing product penetration, the growth of modern retailers, the increasing awareness of beauty and personal care products, the rising aspirations of consumers and strong economic growth.
With the Indian government’s reported determination to reduce the procedural route required for cosmetic imports, the forecaste growth could be bigger than expected.