Now FHRAI raises concerns over Zomato, Swiggy’s 10-minute food delivery apps

The Federation of Hotel & Restaurant Associations of India (FHRAI) has raised concerns over Zomato and Swiggy’s recent introduction of standalone 10-minute food delivery apps. Pradeep Shetty, Vice President of FHRAI, told CNBC-TV18 that the organisation has sought an expedited meeting with the Commerce Ministry to address the issue, which they view as a breach of e-commerce regulations.

Shetty argued that Zomato and Swiggy, originally intended to operate as neutral marketplace platforms, are now directly competing with restaurants by selling their own food products. This creates an uneven playing field and disproportionately harms restaurants, he said.

FHRAI’s reaction comes a day after The National Restaurant Association of India (NRAI) also expressed discontent with the aggregators. On Thursday, NRAI President Sagar Daryani accused Zomato and Swiggy of abusing their dominant positions and breaching the trust of the restaurant community. Speaking to CNBC-TV18, Daryani remarked, “We have been backstabbed by Swiggy and Zomato in a way.”

The NRAI has announced its intention to approach the Competition Commission of India (CCI) to seek intervention regarding these practices.

Albinder Dhindsa, CEO of Zomato’s quick-commerce platform Blinkit, defended the company’s actions and denied allegations of unfair competition.

In a post on the social media platform X, Dhindsa said, “Zomato will never launch private brands on the Zomato app to compete with its restaurant partners. This still holds true. Which is why this service is not being built within Zomato (the organisation which runs the brand, or the app). This is a standalone team, with a standalone app – and no Zomato restaurant data has been used. We will not even use the Zomato app to market Bistro.”

“This is going to be a significant additional cost to us, but ethics and sticking to our word mean more than anything else to us at Zomato and we are not going to give it up to save some marketing cost. All the companies innovating with us on Bistro also work with a number of restaurants and our success at Bistro has the potential to add value for the entire food & restaurant ecosystem,” Dhindsa added.

Also, as @deepigoyal has always said, Zomato will never launch private brands on the Zomato app to compete with its restaurant partners. This still holds true. Which is why this service is not being built within Zomato (the organisation which runs the brand, or the app). This is… https://t.co/q79x4vZJsR

— Albinder Dhindsa (@albinder) January 10, 2025