India's shifting medical cannabis policy and how it's impacting the wellness industry

On this World Cannabis Day, India stands at a juncture grounded in centuries of traditional heritage but looking into a scientifically directed, economically shining future.

Apr 20, 2025 - 04:07

India's shifting medical cannabis policy and how it's impacting the wellness industry

Cannabis has had a special significance in India’s traditional medicine systems for centuries. Ancient Ayurvedic texts often explain it as a healing herb used to mitigate pain, stress, and sleeplessness. As modern science is evolving rapidly, medical cannabis is rediscovered as a beneficial therapeutically, emerging as the go to solution for holistic wellness. We have observed a gradual yet meaningful shift when it comes to India’s policy landscape around medical cannabis.

When it comes to laws in India, recreational cannabis remains illegal, the Narcotic Drugs and Psychotropic Substances (NDPS) Act does permit cannabis use for medical, scientific, and industrial purposes, wherein states can decide on the approvals. The regulatory framework still remains unclear in practice, often leading to uncertainty for researchers, entrepreneurs, and even consumers.

With people around the globe celebrating World Cannabis Day, India too has reached a moment of transformation. New science has been combined with ancient practices, and cannabis is increasingly sought for healthcare solutions. With improved cultivation, awareness, and changes in law, the country has a tremendous potential to emerge as the global hotspot for medical cannabis—both to heal patients and boost the economy.

Scientific research has established that cannabinoids can be beneficial for patients with conditions such as PTSD, insomnia, glaucoma, arthritis, and even certain neurological disorders. As India struggles with contemporary healthcare challenges, incorporating cannabis-based treatments can provide more personalised, plant-based, and natural holistic solutions.

Industry with exponential potential

The medical cannabis market is experiencing significant growth. From 2022 to 2027, the industrial cannabis market size is expected to rise at a remarkable compound annual growth rate (CAGR) of 24.3%. This rising trend is expected to boost market value from $27.7 billion in 2022 to $82.3 billion by the end of 2027.

Given the vast biodiversity and agricultural heritage of India, we have the chance to leverage this opportunity. Additionally, according to a report by Insights10, the Indian cannabinoid medicine market is expected to reach $1.2 billion by 2025. It clearly shows the shift in perception, policy, and public interest.

States like Uttarakhand, Uttar Pradesh, Himachal Pradesh, and Madhya Pradesh have initiated or proposed regulated cannabis cultivation for scientific and medical uses. Not only do these policy developments show a significant shift when it comes to lifting the taboo but also showcases cannabis’ potential as a source of innovation, income avenue, and to improve healthcare. All India needs is a transparent, streamlined policy with a more collaborative approach between central and state authorities.

There has been an increased awareness of the therapeutic potential of cannabis, especially cannabidiol (CBD). Ukraine and Japan have recently enacted laws to legalise medical cannabis, following Europe and the US where CBD is already licensed for use. These changes reflect a wider acceptance of medical cannabis globally.

Economic potential

If we talk about agricultural land in India, more than 12 lakh hectares is lying unused, where regulated cannabis farming can possibly offer a sustainable revenue stream for Indian farmers, bolstering income. Hemp is already being used in textiles, wellness products, and building materials.

Cultivation of cannabis for medical purposes can help with employment, strengthening rural economies. India possesses the advantages of low-cost labour, favourable climate conditions, and decent farming knowledge, which can help in building a solid foundation to compete on the global scale. However, if India wants to compete globally, it will require investment in research with streamlined regulations, and supportive policies for domestic manufacturing so that medical cannabis in India can be more accessible and affordable.

Legal landscape and policy progress

Although legal provisions have improved, still there are barriers hindering the progress of medical cannabis in India:

There are complex regulations where the overlapping laws often make it tough to bring in cannabis-based products to market or conduct clinical research.

Import cost of these products are also high, making it expensive because of tariffs and regulatory red tape.

The existing stigma and perception are still a daunting issue for the industry, influencing public opinion and healthcare adoption, even though its medical value is proven.

Overcoming these barriers requires education and advocacy. Public healthcare professionals and policymakers should be engaged and come up with various awareness initiatives to clarify scientific facts and correct misconceptions.

Collaboration and reform required

The success of regulated medical cannabis in India depends on collaborative efforts by the government agencies, research institutes, physicians, and industry players. These could include:

Developing standardised growing techniques to ensure consistency and quality.
Promoting clinical research to create local evidence and trials.
Creating incentives for local manufacturing to limit costs and stimulate investment.
Initiating public information campaigns to popularise the medical use of cannabis.

These steps can bring about a healthy wellness industry powered by legal, safe cannabis products that capture local and foreign markets.

Implications for the wellness industry

The entry of medical cannabis in India has the potential to revolutionise the wellness space by introducing plant-based, science-backed solutions to the mainstream healthcare segment. From managing stress to better sleep, pain relief, coping with day-to-day anxiety and stress, cannabis-based products are carving out new niches in overall well-being.

With growing demand for natural, preventive healthcare options—particularly among millennials and Gen Zs—medical cannabis provides a solution that is a blend of ancient and modern solutions. Wellness ibusnesses, clinics, and even online stores are beginning to consider cannabis-based products, opening up space for a new vertical in the overall health and wellness segment. With proper education and standardisation, cannabis-based wellness can become mainstream among India's health-conscious consumer base.

Conclusion

On this World Cannabis Day, India stands at a juncture grounded in centuries of traditional heritage but looking into a scientifically directed, economically shining future. Medical cannabis is not just about a plant, it is about the potential for all-round healthcare, rural growth, and global leadership. With positive policy shifts, increased awareness, and investment in research, India has the potential to become the world leader in the medical cannabis revolution—one that will harmonise public health and economic growth.

(Richa Jaggi is the Co-founder and Chief Marketing Officer of Awshad, a cannabis wellness startup.)

Edited by Kanishk Singh

(Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the views of YourStory.)