September 13, 2023

Weed (Ganja) Is Secretly Legal In India & Worth Billions!


India has a long history and cultural acceptance of cannabis use, but it was banned in 1985 due to global anti-drug policies. Now, the potential economic and medicinal benefits of legalizing cannabis are leading many states to decriminalise it, and full legalisation seems imminent.

India has had a complex relationship with cannabis over the centuries. What was once an integral part of ancient Hindu rituals was criminalized in the 1980s under global pressure. But in recent years, the winds of change have slowly started blowing. Legal loopholes, public support, and commercial potential are bringing cannabis back into the mainstream. This in-depth article explores the past, present, and future of legal weed in India - a market estimated to be worth billions.

A Long History of Acceptance

Cannabis has been entrenched in Indian culture for millennia. The earliest mentions date back to 1000 BC in the ancient Hindu text Atharvaveda, which described cannabis as one of the “five sacred plants”. It was commonly used in religious rituals to induce trance-like states and spiritual experiences.

The most well-known use is in the worship of the Hindu god Shiva. Ancient texts like Artharvaveda and Shivpuran suggest offerings and consumption of bhang (edible cannabis) to Lord Shiva. He is believed to have rested in the shade of a cannabis plant on a particularly hot summer day. Given cannabis’ cooling properties, devotees began offering bhang to appease and please Shiva during summer.

These ancient roots meant cannabis consumption was socially acceptable and legal for most of India’s history. While recreational use spread through India, medicinal usage continued in the Ayurvedic and Unani systems of medicine. Cannabis featured in ancient texts like Sushruta Samhita (200 BC) for its healing properties. Despite invasions and colonization, cannabis escaped prohibition in India while the rest of the world criminalized it.

The Turning Point - NDPS Act, 1985

India’s tolerant attitude was disrupted in 1985 with the passing of the Narcotic Drugs and Psychotropic Substances (NDPS) Act under Rajiv Gandhi’s government. This act criminalized the cultivation, production, possession, and trade of cannabis. It also imposed strict penalties for violating the law.

This change can be traced back to diplomatic pressure from the US. In 1985, DEA agent Enrique Kiki Camarena was kidnapped, tortured and killed in Mexico by drug traffickers. The US held the Mexican government accountable and demanded action against the illegal drug trade.

Around the same time, the US started pushing for a global ban on drugs. India aligned with the US’s War on Drugs policy. The NDPS Act ended India’s long history of legal marijuana use. While traditional consumption continued illegally, it led to the arrest and imprisonment of many people involved in cultivation and trade.

India also lost its prime position as a cannabis exporter. In the 1940s and 50s, India was one of the largest cannabis producers in the world supplying cannabis globally for recreational and industrial use. The NDPS Act changed India’s global standing as a major exporter to one of the top importer of cannabis.

The Tide Turns - Decriminalization Starts

While the NDPS Act banned cannabis nationally, it left scope for states to implement their own cannabis policies. Section 10 allowed state governments to permit and regulate cultivation, production, trade and consumption.

This regulatory flexibility has allowed many states to decriminalize cannabis. Uttarakhand legalized industrial hemp cultivation in 2018 to capitalize on its commercial applications. Odisha allows the regulated sale of bhang and permits its ritualistic and medicinal use. Bihar too excludes bhang from prohibition under the NDPS Act.

Many other states like Manipur, Rajasthan, Chhattisgarh, Madhya Pradesh, and Assam have followed suit in varying capacities and contexts. Even more states have legalized or are considering legalizing medicinal cannabis.

Himachal Pradesh became the first state to allow regulated cultivation of cannabis for medical and industrial use in 2019. Ayurvedic cannabis medicines are gaining popularity and spurring research into the plant’s therapeutic potential. Cannabis startups are entering this nascent market for medical marijuana products. Globally too, medicinal cannabis is now legal in 37 countries.

While concrete policy changes are yet to follow, influential voices from politics, business, science and media have endorsed legalization and regulation of recreational cannabis. Overall, the regulatory environment has been loosening over the past decade in favor of cannabis.

Surprise Statistics: Widespread Illegal Use

Despite strict prohibition under national law, cannabis consumption is widespread in India. A 2019 AIIMS study concluded that over 72 lakh Indians use cannabis for recreational and medical purposes.

Delhi and Mumbai were ranked 3rd and 6th respectively among the world’s highest cannabis consuming cities with shocking statistics:

  • New Delhi: 38.2 metric tons consumed per year
  • Mumbai: 32.4 metric tons consumed per year

The numbers clearly show that prohibition has not stopped recreational use, only driven it underground. Activists argue that legalization can help regulate product safety, quality control, and accessibility while curbing criminal activity associated with illegal markets. They also cite successful examples like the US, where decades of prohibition gave way to decriminalization and legal markets.

The Growth of Legal Cannabis in the US

The US shares similar roots with India, from early acceptance to 20th-century prohibition. But while India has stuck to blanket prohibition, the US has undergone a major policy overhaul. The Controlled Substances Act classified cannabis as a Schedule I drug with high potential for abuse and no medical value - thereby prohibiting it federally.

But over the decades, state-level legalization has challenged this outdated view based on new research. Today, medical marijuana is legal in 37 US states and recreational use is legal in 19 states. This legal market was valued at $25 billion in 2021, with a forecasted growth to $37 billion by 2025.

This growth has been made possible by creating a framework to regulate production, testing, distribution and retail. Legalization has also increased tax revenues and employment besides actually reducing youth consumption rates compared to illegal markets.

Could India draw lessons from the US experience to transition towards legalization? Many think this cannabis revolution now brewing in India is similar to the US 20 years ago. The question is how long India will take to catch up.

Economic Potential - New Income for Farmers, Taxes for Government

Cannabis offers India an economic opportunity of immense proportions given the right regulatory framework. India already has the basic agricultural foundation.

According to estimates, legalizing cannabis for export purposes alone can bring in around INR 70 billion per year (~$1 billion) in forex. If cannabis production and trade are properly regulated, it could become a bigger agricultural commodity than tea or coffee.

It offers benefits like:

  • Generating employment: Over 60% of India’s population still depends on agriculture. But the agri sector only contributes around 15% of GDP. Higher value crops like cannabis can improve farmer incomes and living standards.
  • Boosting exports: India can become a global exporter of cannabis products for medical and recreational markets across the world. Imports too can reduce with local production ramping up.
  • Higher tax revenues: Legalization brings all transactions into the tax net. More funds can be channeled into education, healthcare and infrastructure.
  • Lower production costs: Cannabis is less resource and input-intensive compared to other commercial crops. It requires less water and synthetic chemicals. Production can increase with existing agricultural capabilities.
  • Industrial hemp uses: Hemp can be used to make textiles, bioplastics, building materials like hempcrete, biofuels, paper, and more. It has over 25,000 known uses spanning various industries.
  • New industries and jobs: The cannabis ecosystem provides avenues for agriculture-allied industries, processing units, export companies, dispensaries, branding, marketing, quality control, training institutes and much more.

But for India to realize this mammoth potential, the central government has to amend national laws first. Public perceptions are already changing for the better. The time is now ripe for policy reforms.

Promising Initiatives Paving the Path

While concrete changes in the NDPS Act might take more time, promising developments hint at winds of change:

Cannabis Startups

  • HempStreet offers Ayurvedic cannabis medicines in partnership with licensed Ayurvedic practitioners across India.
  • Boheco (Bombay Hemp Company) works with IITs and CSIR to develop hemp-based clinical products, fibres, fuels and nutrition.
  • Bangalore-based India Hemp & Co. sells premium hemp products like hemp seed oil, protein powder, pet supplements, apparel and more.

Political Endorsements

  • Shashi Tharoor drafted a private bill to legalize cannabis in India, citing its medicinal benefits.
  • Himachal Pradesh CM Jairam Thakur pushed for legalizing cannabis for economic growth.
  • Bihar CM Nitish Kumar favors legalization with controls like limiting THC content.

Advocacy Groups

  • Viki Vaurora’s The Great Legalization Movement India is petitioning the government for regulation on cannabis trade.
  • The Indian Industrial Hemp Association is working to differentiate hemp from marijuana to exempt industrial cultivation from NDPS Act restrictions.

Mainstream Media

  • The Print, Indian Express, Newslaundry and other media outlets have published articles, research reports and opinion pieces supporting cannabis legalization.

Big Business Interest

  • In 2018, Baba Ramdev announced that Patanjali Ayurved is considering research on the benefits of marijuana and its derivatives. Other big business houses too have their eyes on this emerging opportunity.

Conclusion: The Billion Dollar Question

How long will India continue to miss out on the booming global cannabis economy? When will public opinion, scientific evidence and business interests converge to sway legislative changes? While legalization appears inevitable, it’s still a matter of when, not if.

India consumed 38,000 kg of cannabis each year as per conservative estimates. Even partial diversion of this demand to legal channels can uplift entire communities involved in its cultivation and trade. It’s time the billion-dollar cannabis question gets the attention and debate it deserves from policymakers.

India ought to change its outlook and tap into its ancient, accepted relationship with this mystical plant. With the right regulations and parameters, cannabis commerce can boost farmers’ income, exports, job creation, medical research and tax revenues while reducing illegal activity. The call for legalization is getting louder. 2024 could be a historic year where parts of India finally parole marijuana.

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