According to the All India Cosmetics Manufacturers Association (AICMA)1, the gray market for cosmetics has substantially grown due to the increase in customers and shopkeepers looking for discounted products. The target market is usually young generation individuals who have greater disposable income and desire for personal grooming.
Similarly, to meet increasing demands for certain food products, adulteration and dilution is common. For such products, the consumer base is households as whole.
The prevalence of fake products is detrimental to different stakeholders at differing levels. For instance, it adversely affects the reputation of the brands whilst simultaneously having the potentiality of being injurious to the ill-informed consumers.
A need exists for government mechanisms such as laws, complaint mechanisms or alternative trajectories to inform and educate consumers.
The Magnitude of the Problem
According to AICMA2, in India most spurious cosmetic products are floating in Delhi and Mumbai with majority coming in from China. One possible reasoning for this trend could be that Delhi and Maharashtra have some of the highest student and economic3 migration within the country.4
Worried health experts warn against the usage of fake cosmetic products as such products may sensitize the skin causing conditions such as contact dermatitis and irritant dermatitis. Additionally, chemicals present in fake products may block skin pores resulting in acne and premature ageing. The presence of excess zinc and lead may damage the whole body.5 Due to the mercury content, the nervous, digestive and immune systems may be adversely affected in addition to lungs, kidneys, skins and eyes. According to a Patna based dermatologist, 15-20 patients frequent her daily due to diseases and reactions such as itching and blisters caused by fake cosmetics.6
Similarly, the circulation of fake, adulterated foods too may be detrimental to the health of the consumer. For instance, in September 2018, enforcement officials seized tea dust powder adulterated by tartrazine (a coloring agent). According to health experts, there is an increased risk of cancer w.r.t. foods adulterated with tartrazine. The officials found tea with the labels "Leeder's Tea and Lion". 7
The Government's Initiative: Launch of 'Smart Consumer App' as a Solution to the Problem
The Government's Department of Consumer Affairs along with the Food Safety & Standards Authority of India (FSSAI) launched a mobile application called "Smart Consumer". The app developed by powered by GS1 India's DataKart aims at providing necessary product information w.r.t. manufacture, price, manufacture date, FSSAI license details, etc. One must scan the product's barcode to determine the authenticity of the product. The app has also established a complaints mechanism.8 Consumers can also use the app to verify the company/product information given on the label and to connect with brands.
Previously9, software company "ThinkCurve" created an application called "LetsveriFY" to check counterfeiting by allowing the end-users to check the authenticity of a product. The app is popularly used by buyers of protein and the cosmetics, fashion, electronics, etc. sector.
Recently in November 2018, Amazon and Flipkart committed to prevent the sales of "unregulated and fake cosmetics" on their websites after sellers were found to be selling injectable cosmetics and stem cell based therapy. The Drugs and Cosmetic Rules have laid down standards which must be adhered to w.r.t. cosmetics. No retailer should deal in products containing ingredients stipulated in the Rule's negative list.10
Further, consumer education and government advocacy programs are conducted by HUL and L'Oréal India to tackle the counterfeit market.11
The initiative by the Government is a much awaited and needed move. The application allows the involvement of stakeholders at varying levels of the vertical to ensure the legitimacy of the product. However, there is a continuous need by the e-commerce websites, social mediawebsites, and regulatory bodies to continue tackling the prevalence of fake products either through their policies or their active functioning.
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