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Last Updated : Jul 04, 2019 06:11 PM IST | Source: Moneycontrol.com

‘What's cooking?’ Govt to ask Zomato, Swiggy, restaurant owners on July 4

The meeting will happen in the evening on July 4 and will be chaired by Ramesh Abhishek, secretary, DPIIT, Ministry of Commerce and Industry.

Priyanka Sahay @priyankasahay

Almost a week after Commerce and Industry Minister Piyush Goyal grilled foreign e-commerce companies in a meeting, the Department for Promotion of Industry and Internal Trade (DPIIT) has summoned online food delivery firms such as Zomato and Swiggy to discuss the issues in the food services ecosystem, according to sources privy to the development.

The meeting will happen in the evening on July 4 and will also see in attendance folks from the offline industry, including National Restaurant Association of India (NRAI), South India Hotels and Restaurant Association and Hotels and Restaurants Association Western India, besides Uber Eats and Foodpanda.

The meeting will be chaired by Ramesh Abhishek, secretary, DPIIT, Ministry of Commerce and Industry.

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"The forum will provide a platform for food services aggregators and restaurant industry associations to discuss mutual areas of interest, identify challenges and develop viable solutions that shall pave the way to boost equitable growth in the industry," said the department in the invite sent to the stakeholders.

Moneycontrol has seen a copy of the invite.

However, according to sources, the main issue that will be discussed is likely to be predatory pricing and opening up of private label brands by the foreign-funded online delivery firms which has been impacting the businesses of offline restaurants.

In his meeting held on June 24, Goyal made it loud and clear that the ministry would not tolerate any violation of Press Note 2 which barred e-tailers from offering discounts or influencing prices of the items sold in any form or manner.

This meeting is a follow-up of the last week's wherein the online food delivery firms will be made to face the offline restaurants to facilitate a two-way communication on the table.

Also read: Piyush Goyal throws the rule book at e-tailers: Follow or else...

Moneycontrol recently reported that online delivery firms were inflating the original price of food items from outlets across the country in order to fill their coffers.

The price inflation can range from Rs 5 to 50, or even more, depending on the size of the outlet.

According to people aware of the development, such arrangements are done in cases where the restaurant owners decline to pay hefty commission rates to the delivery companies, which can vary between 15 to 35 percent of the cost of the item.

The food aggregators then come up with the solution of inflated pricing, the differential of which goes into their pockets.

Interestingly, on one hand, the prices are inflated. At the same time, additional discounts are added to it to attract customers.

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First Published on Jul 4, 2019 11:59 am
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