Some new initiatives that Maharashtra could consider would raise the level of compliance burden on companies in the state’s gig economy, including a possible mandate for EVs and a 2% welfare levy on platforms like Swiggy, Zomato, and Zepto.
The initiatives will help the state to bring the growing gig economy into regulatory purview and improve welfare benefits for delivery workers.
According to the proposed initiatives, major delivery companies could be obliged to make greater use of EVs in their delivery vehicles. This initiative would compel firms to speed up the shift from petrol/diesel to electric mobility.
For companies offering quick commerce and food delivery services, such an initiative would have a direct effect on fleet management. Such firms rely largely on the network of delivery workers for the timely delivery of orders.
The suggested 2% levy on welfare could become yet another burden for the companies doing business in the sector. This levy would be imposed in order to cover expenses on welfare of the gig workers and the platform workers, who make up the majority of workforce behind India’s food delivery and quick-commerce companies.
The fast development of the gig economy has been caused by the expansion of delivery networks for such companies as Swiggy, Zomato and Zepto, as well as the increasing focus on earnings of the workers and their welfare including social security and insurance among others.
For the platforms, such a set of measures could entail higher operational and compliance costs amidst the efforts of the companies to improve unit economics and become profitable.
As for the EV requirement, it would be necessary to coordinate the actions with fleet operators, EV finance companies and delivery partners in order to increase the number of electric vehicles.
Maharashtra is one of India’s biggest markets for food delivery and quick-commerce businesses.
In case of implementation of the measures proposed, they may create a precedent for other states considering regulation of such businesses and increasing social security among gig workers.
For Swiggy, Zomato, and Zepto, the challenge would lie in meeting the regulatory requirements without hampering the fast delivery and competitive prices of one of the fastest growing consumer internet segments of India.
