No Place To Hide (Part 2): Why India’s Food Industry Is Cleaning Up Its Act

From chips to butter coffee, red bull to old monk, school gantines to elite clubs, neighbourhood cafes to luxury findings. A new, fast and feisty FSSAI has trained its spotlight squarely on India's entire foods and drinks universe. State enforcers like the Maharashtra FDA are out in the streets, inside Idri Kitchens, at chemists, barging into warehouses in a slew of inspections and enforcement, even shutdowns. The rules aren't new, the crackdown is, and its jolting industry players out of the comfort zones like never before. How much and how swiftly can the government's sharper stricter shakeup clean up the way India eats and serves? In the first of this two-part series, my colleague Vikas Tandikar spoke to Tukaram Monday, the much-in-news commissioner Maharashtra FDA, who's been leading the charge, suspending the license of well-known outlets like Parcidary Farm and going after hospice, restricting patients to in-house pharmacies. In this episode, we speak to two voices from the industry, who are all out-candid about what the government is doing right and what it could perhaps do in moderation. I'm your host Ratnam Hushin, ET's FMCG editor and it's Tuesday, the 4th of August. This is The Morning Brief. First up, Anjana Chataji, founder of the Listed Speciality Restaurants, owns Markey Branson, India and London, including mainland China and Asia Kitchen, and is one of the most important stakeholders of the National Restaurant Association. Good morning Anjana, thank you for joining us today. Hi, good morning Ratnam. Right. So, Anjana, the 4th services sector has never seen such sharp scrutiny before from regulators. Isn't the cleanup much needed? You couldn't be more right. See, this is a business of conscience. So what is important is that the poor customer, if I may say so, comes in with full trust because he expects that the food which is coming to the plate is actually very well taken care of from the parameters of hygiene food safety. Now, unfortunately, in India, because of the regulatory, regularity of, you know, authorities, people who are regulating it, were not so stringent. So, you know, things become a little lacked a cycle. I'll just take you to London where we run a restaurant called Chaurangi, where there's a food safety authority and they actually give you stars from one star to five stars, depending on your audit. They come unannounced, what is being done in India now and they actually audit every point early in the morning, they will come and they'll go through the same thing. It's not a raid. Only one person comes in, checks the whole protocol list and goes back, give files a report, mind you and gives you 15 days to respond to that. They may degrade you from say five star to four star and they tell you that if you wish to get back to five star, please apply after the 15th day or the 14th day by paying say X amount of money, 100 pounds or something so that we can send our food safety authority inspector of the region once again, but they don't cancel the license unless otherwise the hygiene levels are zero and also in the Western country is the awareness of hygiene in terms of cleanliness is much more it's escalated. So I'm saying that it's a very important thing, unless you are appalling in your standards that you completely floated all rules of press control not being done and actually frankly speaking in India, there are many famous restaurants, no offense meant to them, very popular. If we go to the back of the house, I'm sure that none of us will ever eat that food. So it's all behind the scene and I'm very happy that it's being actually exposed. They've woken up suddenly woken up and that's the reason we are all getting shaken up. And but I'm telling you from our end, there have been nine ordered stretch word. All audits we've got 100 marks. There have been one suggestive thing like, you know, you don't keep this in the store, you keep that, but broadly everything has passed with 10 out of 10. So engine the cricket club of India has approached the Bombay High Court challenging the FDS suspension order. Do you foresee an escalation of similar legal disputes between regulators and companies on this matter? Yeah, if I feel so or maybe another restaurant whose license has been cancelled, for example, Aditya Baila's group had a few restaurants. They were cancelled. They didn't go to court. I really don't know why they did not go to court. Maybe they didn't want to take the authorities head on, but CCI, I'm sure they must be having a reason as long as you're following the protocol and the book which has been given to you, you are by and large there 99%. I don't think that the authorities will come and revoke your license. But at the same time, they must have been some gap which their lawyers have seen and they have seen an opportunity to go back there and tell the court, honorable court, that we are not at fault. So for this kind of punishment. So what's the way forward that consumer interest are protected and both sides, you know, economity is maintained? I think that all the operators have to wake up. If they have not woken up already, it's a question of a restaurant's responsibility, it's conscience. You need to ensure that, you know, you give them a hygienic, safe food on the platter. And also, you know, kept with, I'll give you an example because not many restaurants follow once, you know, lots of people will keep 7, 10 days food inside the refrigerator. You're not supposed to do that. You're supposed to label it. And I think that every restaurant here has a responsibility. The least they can do is to ensure that the food going there for which there is, there are audits, there are ways and means to do. There is deep cleaning. I don't know how many of them do. The organized sector is doing it. But if you go to a very good place, it's a good food, it's a good food, it's a good food and it's a good food. And so on. Even that is food. When I come back from my daughter's house from Pune, I stop there and eat. But I never peep in to see what the hell is the kitchen. Where is it coming from? Plus, another thing is coming. Cloud kitchen is now. Where is the control there? So what I'm saying is that the authorities who control this were not, you know, escalating it to this level. Now everybody's broken up. Maybe some are high handedness. Maybe brackets or may not be. But the fact that the authorities have suddenly escalated to that level. And the cancellation X, Y is a good. They're waking all the restaurantiers up. And we are only saying that authorities must also be a little more understanding since they've gone to the court, CCI. I'm very sure about the fact that there must be some reasons. So I am saying we should take it as an opportunity rather than saying that we are being given a threatening. And I think that every restaurantier must wake up in the morning and promise saying that we are giving you safe hygienic food. Absolutely. And finally, I'd just, you know, like to ask you that there is a school of thought that suspension may not be the way forward. They could probably give notices of at least a fortnight or, you know, like 20 days. What is your view on this? I completely agree with you. I once I said that unless the standards are appalling, whereas you have best all around, you have all the rules flouted. No, you know, control on the deep cleaning. There is nothing full negligence at the back of the house. Unless there is so much seriousness, don't think revoking a license is the best idea. Revoking is the last option. Overall, a benefit of doubt should be given. You reduce my marks from five star to two star or one star. But don't revoke my license. Otherwise, I, we find it to be appalling and they, it's not fit for human consumption. Shadrestra. Next, Ashwin Bhadri, founder of Equinox Labs, the leading food, water and environmental testing organization. He works closely with businesses and regulators to strengthen compliance, consume my trust and food safety standards across India. Hi, Ashwin. Nice to have you on the morning brief. Thank you for joining us. Hey, Ratna, always a pleasure talking to you. So, Ashwin, I'm sure like very busy times for you, there's so much action out there. Why they suddenly. surgeon, regulatory scrutiny. What in your view triggered all this? So I think there are two parts. The first one, let me address the question in Maharashtra right now. Since there is a new commissioner who's come in and I think he's doing a brilliant job at enforcing the law. So I have seen, if I say I write from its early days, write from when it was born, I've been playing some role or the other with it and I've always seen that the lot of advancements have happened. When the person on top wants to make changes, there is a lot of ways that those changes can help citizens of India. At a central level as well, we have a new CEO who's come a few months ago. So I think he's also driving a lot of changes, a driving change that a central level can sometimes take a little longer. But however, I think many of the steps that they're taking are in the right direction. Okay, but shouldn't all this have happened much earlier? Absolutely. I cannot agree more with you. Finally, anybody is going to move as fast or as effectively as their highest authority. In FSSHS case, I remember working very closely with an ex-CEO of FSSS, Mr. Pavanagarwal, while he was in office, I think we were able to do more work than anything that happened from the start of his side till he was there. After he left things slowed down quite a bit because I think the next few CEOs were maybe not as focused as they should have been or didn't take action as much as they should have. And I'm very happy to see that the new CEO is very very focused and he's doing a brilliant job at ensuring that the food served in India, what is imported, what is exported, what is served within the country is doing a brilliant job. So there's an obvious sort of pushback from companies, whether it's food companies or energy drinks or even restaurants or the elite clubs. Is the industry justified in this pushback? So there is a little bit of justification which is there. So while the intent in Maharashtra and across India is that every citizen of India deserves safe and nutritious food, I think some of the tactics which are being currently used, I think could be softened a little bit. For example, if an F.D. officer goes for a raid, if they find something off, they should be first issuing an improvement notice. And after 15 days, if the improvements haven't opened, you know, haven't been done, then a suspension or cancellation, I think should follow, issuing a canceling license or suspending a license right away without notice. I think is slightly on the harsher side and we also have to look at the legality of whether that is something that should happen or see if there is imminent danger, if that, you know, like, the next person consuming the meal is going to fall ill. Maybe there is justification in canceling the license, but if there is no imminent danger, if it's just things that can be improved upon, with no risk to immediate food safety or immediate harm to humans, then I think an improvement notice will work much better. And the industry will understand that yes, FSA, C.I and FTA are working along with them. They're not the enemies right off the industry. They are a part of that entire ecosystem. And the beauty is, I don't know, a group called the Food Founder ecosystem, they are about 9,000 food founders in there. The conversations which are happening over there are very interesting. The industry is actually supporting what he's doing because most people are complying right people are having proper labeling. They have the proper testing done. They're doing the audits. They're making sure that the kitchens are clean, but the people who are not doing it were getting away with it right. With the new enforcement drive, what is going to be happening is people are going to showcase that, hey, if they are operating, they're doing a good job. Under FSA, say that there's something called the hygiene rating scheme, right, which allows restaurants to actually showcase their hygiene because not everyone can step into a kitchen or wants to step into a kitchen, but a rating scheme of any kind, but it allows end users to make, you know, they feel safer that the food that I'm eating at this establishment, it could be a restaurant, it could be a club, a wherever is safe, and I think that is a basic human right. Yeah, absolutely. Another question directly related to this is that, you know, some food makers have alleged that the FSACI definitions itself need to be updated because there's been an explosion of all kinds of, you know, international using Japanese, Korean, Chinese food, etc. And that the definitions fall through the cracks and they do not know in the first place that they are even flouting, you know, the existing definitions, right or wrong. Right. There are two things to address over here. When a new ingredient is introduced, the origin country from where it is coming and obviously will conduct its own food safety assessment. I should India blindly accept their food safety assessment or should India independently also verify it. I think as a country, as a growing nation, these should have regulations in place that verify that any new ingredient which is coming into our country is safe. And that's exactly what FSA is asking for. So while FSACI has regulations in place for novelty ingredients, the speed at which it's operating can possibly be a little faster because if I'm the importer of I'm a food company that's trying to bring in a novel ingredient, I cannot afford to wait for six months or a year. Like getting that approval within 30 to 60 days, which adding is a reasonable timeframe, will allow food businesses to also make sure that whatever they are importing is also safe. Right. See, if I'm a food company and you are selling me something from Japan, I don't actually know whether what you're doing is safe or not, right. Because you may not share the safety data with me. But if my country has verified that yes, that new novel ingredient, the new additive that your adding your product is safe, it allows me also to operate with more confidence. Correct. Which is exactly what's happening in the market right now. And even when it comes to energy drinks, they've called for consultations before mandates are passed. You agree? In some places, yes, FSACI has always been a very collaborative body. I've been a part of a lot of those consultations as well. But there are times when you do not need to consult because we very well know that this is scientifically wrong or this can cause harm to our citizens. At which case, FSACI may take a unilateral decision of banning the product or bringing something. However, the spirit of FSACI has always been that we are a consultative body. We are not just going to, you know, every decision is not unilateral because there are committees at FSA right now as well. There are a lot of meetings that happen where they listen to the ecosystem as well. Can those meetings happen more often? Absolutely. And can those minutes of this meeting remain public? I think that should also happen. Okay. I get that. Ashwin, one more question. This has been the sweeping ban in schools in Maharashtra. So there is a lot of chapter that what happened in Maharashtra today could happen, you know, in other states sooner than later. Is this much needed or somewhat extreme? As a parent of Tuchirajan, I actually agree with what is happening. The habits that we form in our adult life are born in our childhood. So if our kids eat healthier when they're younger, right? Those habits will translate into their adult life as well. So I completely agree with it. Now how well it can be enforced? Right now, I think there's a 50 meter thing. I think that technically should be enhanced a little more because kids can easily walk more than 50 meters. If you're a storage 60 meters, I can just go to 60 meters. Right. However, I think there are two things that should be happening. The ban is one, but two educating children on the importance of safety and nutrition is something that schools are taking up. I am invited many a times and many other experts are invited to schools independently. However, maybe from FDR, FSSI, making these talks almost mandatory every year. Let's say for middle school or senior school because obviously there are new findings that come up as well. Making maybe even a half an hour one hour talk. Making that mandatory to every school will help kids to understand that what am I putting in my body? Because nobody wants to consume something where knowingly they know, oh, it's going to cause something really bad. Right. So that education becomes absolutely important. Correct. Absolutely. And my final question Ashwin is that you know, one year down the line, did you see the food safety, the food ecosystem? Because what has happened now, the reforms seem to be sweeping and whether it's restaurants, cafes, from elite clubs to schools to drinks to alcohol. Everyone has a spotlight on them. So one year down the line where you see the sector going. So one thing I'm seeing is overall the hygiene levels of the entire food industry will be higher. Anyone who is flouting the laws knowingly, like, you know, making adulterated milk or reselling expired products should be penalized at the highest level possible by the law. And those examples will make sure that people are not knowingly causing harm. The second thing is education in the industry where nobody wants to break the rules. It is sometimes they don't know what all the rules are. Right. So training sessions either conducted by the government or privately will ensure that people not just the owners but even the food handlers are aware of what are the regulations and what they need to do to comply. So that I education becomes a big pillar. So the big change that I'm seeing is in the next one year, the entire level of hygiene and of food safety will rise in the country and founders, managers and food handlers will know better so they can be better and do better. So I think that's beeping change. I don't think is going away anytime soon and a lot of people are putting the spotlight on food safety on nutrition and I think it's needed for us as a country. Yes, yes, absolutely. Great conversation and looking forward very much to know what next for the sector. Thanks a lot, Rathna. Always a pleasure to chatting with you. The government's crack-tumps aren't stopping anytime soon. There's pushback from industry players. Some cases are already in court. Animated lobbying is underway for a mid-ground. But regulators aren't relenting with licenses being suspended left-right in center from lapses that have come to light on expired ingredients to unsafe storage, to hygiene issues, to inefficient segregation of vegetarian and non-vegetarian food. Mumbai's elite cricket club of India is already in court challenging the FDA's decision to suspend its license. More legal disputes are in the works. Meanwhile, the lawn of it had cleared up continues at a frenzied pace. That's it for today. We hope you enjoyed listening to the short series. This is your host, Rathna Bhushan, from the Economic Times, signing off. Lissipisod was produced by Anirban Chaudhary, sound editor Amrit Redji. The morning brief drops, thrice a week on all your favourite listening platforms. Thank you for listening and have a nice day ahead.