Key Points
- India found nicotine pouch sales at Mumbai airport duty-free shops breached the law.
- The shops are operated by Mumbai Travel Retail, a joint venture led by Adani with Flemingo.
- India’s drug department said nicotine pouches require drug registration and import approval.
- Adani denies wrongdoing and says domestic drugs law should not apply to duty-free shops.
- The Bombay High Court scheduled the case for a July 14 hearing.
2Firsts
July 8, 2026
An Indian investigation found that duty-free shops at Mumbai international airport operated by billionaire Gautam Adani’s business group sold nicotine pouches in breach of the law, Reuters reported on July 7. The Indian government considers nicotine pouches a new public health risk.
Indian Drug Officials Say Approvals Were Required
According to investigation documents cited by Reuters, India’s drug department inspected duty-free shops at Mumbai international airport in March after receiving complaints from anti-nicotine group Mothers Against Vaping. The inspection found imported nicotine pouches being sold in the international departure zone without required approvals.
An assistant drugs controller wrote in an April 2 letter to the airport’s customs authority that nicotine pouches fall under the definition of a drug and therefore require a valid registration certificate and import license. The letter attached an investigation report.
Government letters showed that Mumbai Travel Retail was asked to stop selling nicotine pouches and seek approvals. Mumbai Travel Retail is a joint venture led by Adani with Dubai-based Flemingo.
Adani declined to comment to Reuters. Flemingo and Indian health and customs authorities did not respond to Reuters requests for comment.
Adani Challenges the Scrutiny in Court
Reuters reported that Adani denies wrongdoing and is asking judges to declare that India’s drugs and cosmetics law does not apply to duty-free shops or nicotine pouches.
According to High Court filings reviewed by Reuters, Adani’s firm told authorities that shops in the international departure area conduct business beyond India’s customs frontiers and are outside the reach of domestic regulations.
On June 24, judges in the Bombay High Court said no coercive action should be taken over existing nicotine pouch stock at the Mumbai airport duty-free shops. The case was scheduled for a July 14 hearing.
The case could set an important precedent for how India regulates sales of new nicotine products in airport duty-free outlets. Lawyers cited by Reuters said a government win could block nicotine pouch sales in Indian airports.
India Treats Nicotine Pouches as Unapproved Products
Reuters reported that India has banned e-cigarettes and allows certain nicotine replacement products, such as patches and chewing gums, after registration under the Drugs and Cosmetics Act. Nicotine pouches remain illegal and unapproved.
A June Indian government study called nicotine pouches a new and largely unregulated public health concern, citing widespread illegal sales and consumption among people aged 18 to 40.
The study also said Zyn and White Fox were being sold illegally by Indian vendors. Reuters reported that since August, Adani’s firm had imported Philip Morris’ Zyn nicotine pouches in various flavors worth more than $29,000, and White Fox products from Swedish Smokeless Solutions worth $7,700. The companies did not respond to Reuters queries.
Duty-Free Regulatory Boundaries Come Under Scrutiny
One core issue in the case is whether airport duty-free shops in the international departure zone can be considered outside India’s domestic drugs regulatory framework.
Murali Neelakantan, a former general counsel at Indian drugmakers Cipla and Glenmark Pharmaceuticals, told Reuters that being beyond customs frontiers does not mean Indian police or regulators lack authority. He used guns and ammunition as examples of products that could not be sold simply because a shop is located in an international departure area.
Flemingo Dutyfree also told the High Court that it operates shops at international seaports, including in Mumbai, and fears similar actions. Court documents showed it was in the process of stocking nicotine pouches. The company said that requiring licenses for nicotine pouches would force suppliers to withdraw them from the market and make India’s duty-free industry less attractive to passengers.
Industry Impact and Next Steps
The case shows that nicotine pouches in India may face a complex legal environment involving drugs regulation, customs rules and duty-free retail.
For nicotine pouch brands and duty-free retailers, the case may affect how they assess airport, seaport and travel-retail channels in India. If the court backs regulators, nicotine pouch sales in Indian duty-free outlets could face clearer restrictions.
For Adani, the case also touches on its airport retail expansion. Reuters reported that Adani operates eight airports in India and is targeting an $11 billion expansion that includes duty-free offerings. At Mumbai international airport, it operates more than 30 duty-free shops.
Key issues to watch include the July 14 Bombay High Court hearing and whether Indian drug, customs and airport authorities further clarify the legal status of nicotine pouches in duty-free channels.
Overall, the case is not only a dispute over airport-shop sales. It highlights the regulatory classification questions facing nicotine pouches as they enter emerging markets. For global nicotine pouch companies, India’s uncertainty may centre on whether the products are treated as drugs, whether duty-free channels are subject to domestic regulation, and whether import and sale require drug registration and licensing.
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Cover Image source: Reuters
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