The Paradox of the Indian Hemp Industry

A retrospective proviso excluding industrial hemp from Section 2(iv) would align law with policy, unify agencies, and remove the shadow of criminality.

India’s hemp industry is trapped in a statutory paradox. State policies promise a bio-economy, yet Section 2(iv), Narcotic Drugs and Psychotropic Substances Act, 1985 (NDPS Act) criminalises every cannabis plant by defining the entire genus as narcotic. Administrative rules cannot dilute this definition. Without a parliamentary amendment, all innovations remain ultra vires.

The botanical paradox: Genus versus species

The current deadlock stems from the definition of the term “cannabis plant”¹, which subsumes all known strains by using the term “genus” in its definition. By using “genus” for cannabis and “species” for opium poppy, the two are placed on different legal footing. In contrast, the repealed Dangerous Drugs Act, 1930² (DDA), specifically targeted Cannabis sativa L., bringing it under the narcotic threshold, while leaving other strains — Cannabis indica and Cannabis ruderalis — outside its ambit. Cannabis sativa L. was included as the intoxicating strain, while the other varieties were either not prevalent or not extensively used in India at the time — ensuring that the narcotic focus remained on the intoxicating species alone. By contrast, Section 2(iv), NDPS Act, defines “cannabis plant” as “any plant of the genus cannabis”. By outlawing the entire genus, the law rendered chemical profiles [such as tetrahydrocannabinol (THC) content] legally irrelevant. This blanket approach brought the entire genus within the ambit of NDPS Act, sidelining the significance of THC.

The “ultra vires” risk: Traveling beyond the four corners

In administrative law, it is well settled that the executive cannot “travel beyond the four corners” of the parent legislation. A rule, as delegated legislation, must serve the Act and cannot contradict it. When a State Government frames rules permitting cultivation of the cannabis plant with less than 0.3 per cent THC, it is artificially creating a chemical sub-classification that does not exist in NDPS Act. Without a corresponding amendment to Section 2, such subordinate legislation is arguably beyond legal power, as it attempts to modify a statutory definition through administrative notification or rule making process.

Judicial precedent (Kerala High Court, 2025)

In Jatin v. State of Kerala³, the High Court originally observed:

14. … The essence of the offence lies in the conscious act of planting and nurturing a cannabis plant in contravention of the provisions of the Act.

The Court clarified that whether the plant was cultivated in a pot or directly in the soil made no difference — in either case, the act constituted an offence under the NDPS Act. The reasoning was anchored in the strict statutory definition under Section 2(iv), which covers any plant of the genus cannabis. This precedent underscores that unless Section 2, NDPS Act itself is amended, administrative innovations such as THC-based thresholds remain ultra vires.

The Himachal experiment

On 27 December 2025, Himachal Pradesh Chief Minister Sukhvinder Singh Sukhu launched the “Wild Weed to Himalayan Gold” initiative.⁴ Targeting annual revenue of Rs 2000 crores, the policy mandates a strict 0.3 per cent THC limit to ensure the crop remains non-intoxicating. However, this policy rests on subordinate legislation conferred by NDPS Act through Sections 10 and 14. While Section 14, NDPS Act permits States to allow “cultivation of any cannabis plant for industrial purposes only of obtaining fibre or seed or for horticultural purposes”, it does not overcome the definition of “cannabis plant” in Section 2. The non obstante clause in Section 14 is intended to overcome the restrictions in Section 8, but it does not address the systematic requirement for a decisive exclusion in Section 2. In the eye of the law, the cannabis plant under cultivation remains legally classified as a “narcotic”. Irrespective of THC content, the plant may bypass statutory prohibition under Section 14, but its legal identity and definition remain unchanged, i.e., that of a cannabis plant.

The global shift to statutory clarity

Globally, to harness the potential of hemp, many countries have amended their parent Acts, recognising that administrative rules alone are insufficient to protect the industry from the “shadow of criminality” inherent in drug laws:

1. New Zealand (December 2025)⁵: Formally established a 1.0 per cent THC threshold in domestic law, shifting from a narcotic-licence model to a permission-based agricultural framework.

2. United States⁶: Explicitly amended the Controlled Substances Act to exclude “hemp” (<0.3 per cent THC) from the definition of marijuana.

3. European Union (2023)⁷: Implemented Regulation (EU) 2021/2115, raising the THC limit to 0.3 per cent in the parent law, thereby ensuring that national drug laws could not override agricultural rights.

4. China (2010 onward)⁸: Permitted industrial hemp cultivation through provincial licensing, notably in Yunnan and Heilongjiang, with strict THC thresholds to distinguish hemp from narcotic cannabis. While on paper it may appear that India has replicated the Chinese model, the situations are fundamentally different. In India, subordinate legislation cannot supersede, overtake, or outgrow the parent statute; statutory definitions remain supreme until Parliament itself amends them.

The cure: A retrospective proviso

For any empowered department or court of law, the strict definition in Section 2(iv) reigns supreme. If a field is seized, the prosecution can readily argue that a State rule is subservient to NDPS Act and cannot override it without a statutory amendment. The only clean legal solution is a parliamentary amendment to Section 2, NDPS Act, through the insertion of a proviso that explicitly excludes hemp from the definition of “cannabis plant”.

Proposed amendment structure

“Provided that ‘cannabis plant’ shall not include ‘industrial hemp’, being a plant of the genus cannabis with a THC concentration not exceeding 0.3 per cent on a dry weight basis; and such plant shall be deemed never to have been included.”

Conclusion: Forging a path for growth

Only Parliament can cure the flaw. A retrospective proviso excluding industrial hemp from Section 2(iv) would align law with policy, unify agencies, and remove the shadow of criminality. Legislative precision, not administrative improvisation, is the path to a lawful hemp economy.