Reeling under acute financial pressure, the Postal Department is exploring new areas of revenue including commercial use of huge real estate at its disposal to guard against any debt trap.
With losses of over Rs 400 crore (Rs 4 billion) annually -- which could be attributed to a chunk of postal business going to private competitors, the government is working seriously on different proposals, including commercial use of land, to make this over 100 years old institution financially viable.
India Post has huge properties in each circle including Nariman Point in Mumbai. The land is either lying vacant or is leased out at a meagre rent, senior officials said, adding these would now be used for commercial purpose to earn revenues. The government is likely to create a Special Purpose Vehicle to bring the postal department out of losses and earn revenues.
This is for the first time that Communication and IT Minister A Raja has taken a view on the issue. Officials said a Cabinet note for creation of SPV would be moved soon. Asked by when the department would place the matter in the Cabinet, officials said the matter would be taken up within a month.
The department is also working on innovative schemes like instant money order, air transfer of logistics and computerisation of main centres. These efforts would help India Post become self-sufficient in the coming years, they said. When contacted Department of Post General Manager J Samuel said "we are expecting a revenue of about Rs 550 crore (Rs 5.5 billion) for the current financial year, up from about Rs 450 crore (Rs 4.5 billion)."
With a view to fight competition from the private sector, India Post has started home collection service free of cost, whereby the postal officials would collect the parcels or speed post articles from customers' residence.
The Postal Department has recently acquired an aircraft for faster transfer of speed post, mails and logistics in the north east. Samuel said the department would soon extend this service to all the major areas across the country. For this purpose, it would buy more aircraft in the coming year, he said declining to give any timeframe.
He claimed that the transfer of logistics through DoP's aircraft would be 50 per cent cheaper than the other airlines. Under instant money order scheme, users would be able to send and receive money within a short span of time of about five minutes. The facility has already been launched across 600 cities and would be extended to other areas very soon, he added. It is also in the process of computerisation of all the main post office centres across the country.
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