Coca-Cola, PepsiCo may face losses upto Rs 1,400 crore as Tamil Nadu traders may ban products over a critical issue

Major trade associations Tamil Nadu Vanigar Sangam and Tamil Nadu Traders Federation have instructed more than 15 lakh members not to sell PepsiCo and Coca-Cola products from March 01.

The traders are thinking of banning the products from March 01 and this can dent the companies up to Rs 1,400 crore in annual sales.

ET reported the traders have accused the firms of "exploiting the state's water bodies to manufacture aerated drinks while farmers were facing severe drought”.

PepsiCo's brand Pepsi has 60% market share in Tamil Nadu.

"It is extremely unfair on the part of certain individuals and organisations to propagate misinformation. These actions are detrimental to the image of the country and to the long-term interests of the Indian economy,” Arvind Varma, secretary general of industry body Indian Beverage Association (IBA), said in a statement on behalf of Coca-Cola and PepsiCo.

The TN trade associations' decision to stop selling Coca-Cola and PepsiCo's products on their own comes at a time when makers of sugary drinks are witnessing single-digit growth and the government is considering a fat tax on sugary drinks and packaged snacks high on salt in the upcoming budget.