Date:08/07/2005 URL: http://www.thehindubusinessline.com/2005/07/08/stories/2005070803110900.htm

Back Postal Dept eases into fast lane

C.J. Punnathara

Kochi , July 7

EVERY time the ubiquitous postman was delivering the humble post card at your doorstep reminding you that the service date for your two-wheeler, fridge or washing machine was due, the Government was subsidising the service by as much as Rs 6.

That is not all. The Government was subsidising the printed post card by as much as Rs 4, inland letter by Rs 4.50, registered newspapers by Rs 8, printed book post by Rs 9 and the registered newspaper bundle by Rs 12.

The advent of the Internet and online money transactions are making the telegram redundant and the money order could soon be heading the same way.

While the value of money orders transmitted fell by 20 per cent, traffic declined by 5 per cent in 2003-04. Mail traffic, both registered and unregistered services, have fallen by 5 per cent.

Small wonder then that the Indian Department of Posts ran up a deficit of Rs 1,375 crore in 2003-04. Efforts to boost the traditional revenue streams of the department have not been quite successful, say trade union sources in the department. A silver lining, however, is emerging. Various financial services undertaken by post offices, such as savings deposits, recurring and term deposits, Monthly Income Scheme, National Savings Certificate, etc, have been quite successful, mobilising Rs 2,01,183 crore from the public, as on March 2004.

The returns have been equally rewarding at Rs 1,762 crore.

This revenue stream, which has been growing at close to 12 per cent, has proved to be the biggest money-spinner for the Postal Department in recent years.

While post cards and inland letters, the traditional hallmark of the Department, have been on the decline, both in terms of volume and revenue, new generation products such as Speed Post, Business Post, Media Post, Express Post and Greetings Post have been successful - growing by over 32 per cent on a year-on-year basis.

"It is not the end of traditional post cards and inland letters in India. This vital communication links large masses of rural people, who are still precariously dependent on it. But the urban elite seems to be shifting to new-generation value-added services. This is a welcome development for both rural India and the revenue streams of the Department," say the trade union sources.