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New Postal Policy 2012 - Road Map to Privatization

Saturday, 18 August 2012


Government of India has declared the New Postal Policy 2012. Shri Kapil Sibal, Minister Communications & IT has made a press statement also. Finally Govt. has decided to end the monopoly of Postal Department in collecting, processing, conveyance and delivery of letter mail articles and allow private couriers also to function legally.

As per the Govt’s. version – “the idea is to develop Indian Postal Sector as a full-fledged market, bring in more service providers to enhance employment (?) and contribution to nations GDP (?).” It further states that – “At present Department of Posts, which has around five lakhs employees, is the sole body responsible for policy making, regulation and providing postal service. The over 100 year old Indian Post office Act, which governs the Postal sector, bars any individual or entity from delivering letter for commercial purpose.” Communication Minister has asked Department of Posts to create a framework to support small and medium Postal Operators (i.e. couriers) and new models to encourage entrepreneurship in the sector.

One of the guiding principles of the National Postal Policy (NPP) is promotion of partnership between private and public postal sectors. (i.e between couriers and Department of Posts) and to promote cooperation, inter action, resource sharing and fair competition among stake holders.

The NPP says that – “Competition leads to consumer satisfaction through lower prices, more choice and better quality of service. Efforts are therefore required to promote competition in the provision of Postal Services so as to maximize benefits to customers, particularly in rural and inaccessible areas Therefore it is necessary to develop a governance and legislative system that promotes fair competition in the Postal market and offers customer ample choice”.

In order to implement the above stated privatization policy, the Government is planning to separate the functions of policy making, regulation and operations of the over 150 years old Department of Posts. An independent body named Postal Development Board (PDB) will be responsible for the overall development and governance of the Postal Sector (including courier services). The PDB will also draw a roadmap for unbundling (ending monopoly and allowing private participation) of Postal departments functions.

The PDB will be set up under Secretary (Posts) and will include secretaries of Department of Economic Affairs, Department of Electronics and Imformation Technology, Department of Commerce and two members from Postal Services Board. A Postal Advisory Board (PAB) will be constituted which will have representation from Government, Industry payers, academics and other stake holders, to provide inputs to PDB on policy matters.

If the NPP is implemented in its totality, then the Postal Department will definitely meet the fate of Telecom. The existence of Department and job security of the five lakhs Postal employees will be in danger. NFPE calls upon the Postal and RMS employees including GDS to be ready for serious trade union action if the Government take any unilateral decision to privatise postal sector.


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