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Written by Manish Singh

India’s Swiggy bets big on cloud kitchens

Can cloud kitchens take off in India? Swiggy, one of the country’s largest food delivery startups, is betting on it. The Prosus Ventures-backed startup said on Wednesday it has established 1,000 cloud kitchens for its restaurant partners in the country.

The Bangalore-headquartered firm said it has invested in over a million square feet of real estate space across 14 cities in the country over the last two years to help restaurant partners of all sizes expand to more locations both within their city and across new cities through cloud kitchens.

Swiggy said it has already invested about $24.5 million in its cloud kitchens business that it calls Swiggy Access, and plans to pump another $10.5 million into it by March next year.

Compared to developed nations like Japan and the U.S., India remains a very underpenetrated market for restaurants. “Even in dense areas, you know you need more restaurants,” said Larry Illg, chief executive of Prosus Ventures, in an interview with TechCrunch.

“That’s the value of creating kitchens for delivery platforms. We have the visibility of all the market dynamics. We can look at a location, comb through the data and know what kind of restaurants and food supplies would work there. Over time, you come to realize the neighborhood and their collective behaviour,” he said.

That’s where cloud kitchens could help. For restaurateurs, cloud kitchens reduce the risk when they look for expansion. “You have figured out the menu, and you know the operations. But you still have to take a big real estate risk when picking the location. Kitchens allow them to de-risk all these factors,” said Illg.

Early signs show that the concept of cloud kitchens is working for Swiggy Access partners. The company said one in three partners has been able to expand to a second kitchen within 90 days of signing up. Many restaurants from smaller cities have also expanded into big cities, the startup said.

Raymond Andrews, founder and chief executive of Biryani Blues, said in a statement that Swiggy Access has enabled the eatery to “expand quickly into newer territories not just in Delhi-NCR but also to Chandigarh. In the six years of our existence, I have found Access to be the easiest way to expand my brand. It’s a game-changer for the industry.”

Swiggy believes that India could emerge as the second-highest number of cloud kitchens after China in the coming years, said Vishal Bhatia, CEO of New Supply business at the firm. A year ago, the company had just 200 cloud kitchen partners.

“The milestone of Swiggy successfully creating over 1000 partner kitchens shows the faith the restaurant partners have in the concept and bolsters our pioneering efforts in enabling more success stories in the restaurant ecosystem,” he said.

Swiggy is also betting that cloud kitchens will help it speed up the delivery time. Swiggy co-founder and chief executive Sriharsha Majety said last month that the company is quickly scaling up “pods” that house cloud kitchens for restaurants in a way that they are “within a 10-minute reach of 99% of their consumers.”

Swiggy added that it is on track to create 15,000 new direct or indirect jobs in the restaurant industry through its Access program by next six months.

The announcement today comes weeks after news broke that Travis Kalanick, founder and former chief executive of Uber, is buying up cheap properties in India and some other markets to scale his cloud kitchens venture.

Indian newspaper Economic Times reported earlier this month that Ashish Saxena, former India head of TexMex Cuisine, franchisee for American casual dining restaurant chain Chili’s Grill & Bar in the country, is working with Kalanick on CloudKitchens, the new venture.

Food delivery firm FoodPanda, owned by ride-hailing giant Ola, earlier this year also pivoted to cloud kitchens.

India says law permits agencies to snoop on citizen’s devices

The Indian government said on Tuesday that it is “empowered” to intercept, monitor, or decrypt any digital communication “generated, transmitted, received, or stored” on a citizen’s device in the country in the interest of national security or to maintain friendly relations with foreign states.

Citing section 69 of the Information Technology Act, 2000, and section 5 of the Telegraph Act, 1885, Minister of State for Home Affairs G. Kishan Reddy said local law empowers federal and state government to “intercept, monitor or decrypt or cause to be intercepted or monitored or decrypted any information generated, transmitted, received or stored in any computer resource in the interest of the sovereignty or integrity of India, the security of the state, friendly relations with foreign states or public order or for preventing incitement to the commission of any cognizable offence relating to above or for investigation of any offence.”

Reddy’s remarks were in response to the parliament, where a lawmaker had asked if the government had snooped on citizens’ WhatsApp, Messenger, Viber, and Google calls and messages.

The lawmaker’s question was prompted after 19 activists, journalists, politicians, and privacy advocates in India revealed earlier this month that their WhatsApp communications may have been compromised.

WhatsApp has said that Israeli spyware manufacturer NSO’s tools have been used to send malware to 1,400 users. The Facebook-owned company has in recent weeks alerted users whose accounts had been compromised. The social juggernaut earlier this month sued NSO alleging that its tools were being used to hack WhatsApp users.

NSO has maintained that it only sells its tools to government and intelligence agencies, an assertion that stoked fear among some that the state could be behind targeting the aforementioned 19 people — and perhaps more — in the country.

Reddy did not directly address the questions, but in a blanket written statement said that “authorized agencies as per due process of law, and subject to safeguards as provided in the rules” can intercept or monitor or decrypt “any information from any computer resource” in the country.

He added that each case of such interception has to be approved by the Union Home Secretary (in case of federal government) and by the Home Secretary of the State (in case of state government.)

Last month, the Indian government said it was moving ahead with its plan to revise existing rules to regulate intermediaries — social media apps and others that rely on users to create their content — as they are causing “unimaginable disruption” to democracy.

It told the country’s apex court that it would formulate the rules by January 15 of next year.

A report published today by New Delhi-based Software Law and Freedom Centre (SFLC) found that more than 100,000 telephone interception are issued by the federal government alone every year.

“On adding the surveillance orders issued by the state governments to this, it becomes clear that India routinely surveils her citizens’ communications on a truly staggering scale,” the report said.

The non-profit organization added that the way current laws that enable law enforcement agencies to conduct surveillance on citizens’ private communications are “opaque” as they are run “solely by the executive arm of the government, and make no provisions for independent oversight of the surveillance process.”

India says law permits agencies to snoop on citizen’s devices

The Indian government said on Tuesday that it is “empowered” to intercept, monitor, or decrypt any digital communication “generated, transmitted, received, or stored” on a citizen’s device in the country in the interest of national security or to maintain friendly relations with foreign states.

Citing section 69 of the Information Technology Act, 2000, and section 5 of the Telegraph Act, 1885, Minister of State for Home Affairs G. Kishan Reddy said local law empowers federal and state government to “intercept, monitor or decrypt or cause to be intercepted or monitored or decrypted any information generated, transmitted, received or stored in any computer resource in the interest of the sovereignty or integrity of India, the security of the state, friendly relations with foreign states or public order or for preventing incitement to the commission of any cognizable offence relating to above or for investigation of any offence.”

Reddy’s remarks were in response to the parliament, where a lawmaker had asked if the government had snooped on citizens’ WhatsApp, Messenger, Viber, and Google calls and messages.

The lawmaker’s question was prompted after 19 activists, journalists, politicians, and privacy advocates in India revealed earlier this month that their WhatsApp communications may have been compromised.

WhatsApp has said that Israeli spyware manufacturer NSO’s tools have been used to send malware to 1,400 users. The Facebook-owned company has in recent weeks alerted users whose accounts had been compromised. The social juggernaut earlier this month sued NSO alleging that its tools were being used to hack WhatsApp users.

NSO has maintained that it only sells its tools to government and intelligence agencies, an assertion that stoked fear among some that the state could be behind targeting the aforementioned 19 people — and perhaps more — in the country.

Reddy did not directly address the questions, but in a blanket written statement said that “authorized agencies as per due process of law, and subject to safeguards as provided in the rules” can intercept or monitor or decrypt “any information from any computer resource” in the country.

He added that each case of such interception has to be approved by the Union Home Secretary (in case of federal government) and by the Home Secretary of the State (in case of state government.)

Last month, the Indian government said it was moving ahead with its plan to revise existing rules to regulate intermediaries — social media apps and others that rely on users to create their content — as they are causing “unimaginable disruption” to democracy.

It told the country’s apex court that it would formulate the rules by January 15 of next year.

A report published today by New Delhi-based Software Law and Freedom Centre (SFLC) found that more than 100,000 telephone interception are issued by the federal government alone every year.

“On adding the surveillance orders issued by the state governments to this, it becomes clear that India routinely surveils her citizens’ communications on a truly staggering scale,” the report said.

The non-profit organization added that the way current laws that enable law enforcement agencies to conduct surveillance on citizens’ private communications are “opaque” as they are run “solely by the executive arm of the government, and make no provisions for independent oversight of the surveillance process.”