DEPARTMENT OF POSTS MULLS MARKET PRICE FOR BIZ, SPEED POST

PREMIUM, postal services, such as business mails, logistic post and speed post, will get expensive as the government looks for ways to bring down the deficit of the postal department, which is running into thousands of crores. The department of posts (DoP) is considering a market based pricing for many of its products that do not have a social dimension to them to reduce the government subsidy. The idea is to have a sustainable costing and pricing mechanism for postal products and services, even as services are kept affordable for the common man, "said government official in the department of telecommunications and information technology.

The department plans to get the new tariff structure in place before the budget session of Parliament next year and has decided to commission a study by a private consultant to freeze the proposal quickly.

Tariffs for products, such as post cards and inland letters that are used by the poor are not likely to be raised.

Post cards cost 50 paisa each while an unregistered inland letter costs Rs.2.50, well below what it takes DoP to deliver them. According to estimates , India Posts tariff is 70% cheaper for domestic destinations and 30% cheaper for international destinations , when compared to the tariff charged by private courier agencies .As per estimates, the department is expected to generate revenues of Rs.6956 crore, way below its working expenses of more than Rs. 10552 crore.

The Economic Times, New Delhi, 05th October, 2010.