Delhi Government To Consult Food Delivery Aggregators & Operators Over Cloud Kitchen Policy

To provide a conducive environment to food delivery aggregators and cloud kitchen operators to start new business in Delhi and develop a dedicated cloud kitchen policy aimed at creating 2 Mn jobs in five years, the state government will hold a stakeholders consultation session on Tuesday. 

According to an official statement, the consultation will be held by the Delhi Dialogue Commission (DDC), a think tank by the Aam Aadmi Party government, and the state’s department of industries. 

It is important to mention here that the Delhi Government had promised, while presenting the ‘Rozgar Budget’ last month, to create 20 Lakh new jobs in the national capital in the next five years. 

Further, the consultation would be chaired by DDC vice chairperson Jasmine Shah and would be attended by industries’ department apart from representatives from various cloud kitchen operators and food delivery aggregators, the statement said. 

The consultation, to be held at the Delhi Secretariat, would focus on understanding the challenges faced by the industry and exploring the potential and viability of setting up cloud kitchen clusters across the state.   

The Delhi Government claims to be the first state government to recognise cloud kitchens as significant contributors to the food and beverage industry, as per the statement.

The state government is deliberating on providing land and other incentives to cloud kitchens, easing licence regulations for such units and setting up of cloud kitchen clusters with plug and play features across different land parcels in Delhi, it said.

Meanwhile, the number of cloud kitchens in Delhi is growing at a rate of over 20% every year. Currently, there are more than 20,000 cloud kitchens active in Delhi that provide direct employment to around 200,000 people and indirect employment to at least 50,000 people, it said.

“Cloud kitchens have a huge potential to attract investments, increase the market size of the food and beverages sector and generate large-scale direct and indirect jobs,” said Jasmine Shah, vice chairperson, DDC.

Meanwhile, cloud kitchens or virtual kitchens prepare and deliver food at the customer’s doorstep by taking orders via food aggregators such as Zomato, Swiggy, Curefoods , Rebel Foods or other online ordering platforms. The segment witnessed a significant boom during the coronavirus pandemic.

According to a report by RedSeer consulting, the Indian cloud kitchen market is expected to soar to $2-3 Bn mark, in terms of a Gross Merchandise Value (GMV), by 2025. This is a sharp rise compared to the earlier $400 Mn GMV in 2019.

The growth has been fueled by urbanisation, higher disposable income and better supply of new restaurants coupled with a hyperlocal delivery model. 

Furthermore, the global cloud kitchen market reached a value of $ 56.71 Bn in 2021. According to a report by Research and Markets, the market is expected to reach a value of $112.53 Bn by 2027 exhibiting a CAGR of 11.50% during 2022-2027 in the wake of uncertainties caused by the Coronavirus pandemic.