Okay forget terms of service, potential for misuse and lack of laws in India - because none of these are problems with the actual app. Focus on the capabilities of the Aarogya Setu app, and tell me one thing that is wrong with it.
-Bluetooth is for "chirps", same tech used for pairing, gives better proximity information to other devices, higher resolution than GPS which can be spotty at times
-Forcing people to install it or preinstalling it makes sense in a pandemic situation
-The data does not even leave the device and go to the server. If someone reports testing positive, then their info is sent to servers, and you get an alert depending on the data on your phone.
-They have even taken the extra step of encrypting the data that is stored on the device itself, not really necessary as such information can be gleaned even if the app is not there, but people have physical access to the device!
Overall, it is very secure and well implemented. Source code not being made public does not mean that it is not open source
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The closest thing to a real problem was exposing the details of the affected people on Government web sites, which caused their neighbours to shame and humiliate them, which is again a problem with the people, and not the app itself, but yeah, maybe their details should not have been publicly released.
For anyone accusing me of being a bhakt, just google "aditya madanapalle firstpost aadhaar" without the quotes. I made it my business to walk into office every morning and fight that battle for privacy.