The strengths of Republic of Republic of India Post must survive leveraged to larn inwards financially viable
In a the world where communication has assumed unlike forms alongside the written give-and-take beingness transmitted on mobile phones as well as the proliferation of mortal courier services for printed thing or documents, the purpose of Republic of Republic of India Post needs to survive redefined. The starting of the payments banking concern is pragmatic because the subdivision may receive got only taken the correct measuring at a fourth dimension when postal services receive got croak less relevant spell fiscal services croak along to survive of import given their nether penetration inwards rural areas.
To larn a amend feel of how the postal concern has traversed over time, nosotros must await at the final 10 years ending 2016-17. Table 1 juxtaposes some wide numbers taken from the Statistical Handbook of Republic of Republic of India as well as Annual Report of the Postal Department.
Today, the viability of whatsoever organisation is determined past times the break-even numbers. Here it is clear that the deficit or loss made has increased sharply over the final decade. The tabular array also indicates that over the final 10 years the importance of the Postal Department has declined as well as the authorities is aware of this.
The fact that the number of mail offices has come upwards downward every bit receive got the employees on the rolls appears to survive inwards line alongside the declining mass of business, which has come upwards downward past times some vii per cent. The treatment of the savings pie has on the other manus increased which consists of minor savings that is contributed to a greater extent than past times the middle as well as lower income groups alongside a rigid rural bias.
However, hither also the chemical compound growth charge per unit of measurement of some 6.8 per cent is much lower than banking concern deposits which receive got grown at close double the rate. Hence this subdivision remains niche.
Also the losses of the subdivision receive got increased past times over nine times. The subdivision has been run every bit an essential service which is primarily used past times the weaker sections specially inwards the rural areas. This tin survive seen past times the domination of the rural sector inwards total mail offices as well as was 1,39,067 inwards 2016-17.
Postage rates
As a termination it becomes real hard for the authorities to increment the stamp charge per unit of measurement given that it is uniform across the country. Consequently, spell trying to address the communication needs of the lowest income group, the higher income groups also terminate upwards enjoying this benefit.
With this finish inwards withdraw heed the subdivision has been subsidising the cost of operations to a real large extent every bit seen past times the losses beingness incurred on virtually every activity.
The solely service which gets inwards a positive cyberspace income or surplus is insurance. Influenza A virus subtype H5N1 idea hither is that the authorities should reconsider some of the services inwards the low-cal of their relevance. Can coin orders survive replaced past times mobile transfers? If mortal couriers receive got replaced Republic of Republic of India Post for some of the services, tin the same survive truncated? Can the minor savings activity survive hived off to the Payments Bank?
Interestingly, the mass of concern has fallen across all segments which the accompanying tabular array shows. The losses receive got been mounting every bit several costs similar administration, maintenance, salary, etc. motion alongside inflation spell transportation costs maintain moving upwards to a greater extent than than proportionately. Therefore alongside the mass of each concern coming down, these fixed costs increment the cost per unit of measurement of business.
It is mostly believed that visits to the mail business office come upwards downward when at that topographic point are alternatives available. However, when the communication is from or to authorities departments across the province at that topographic point is a mandatory usage of postal services. This holds for all project applications as well as submission of documents as well as thence inwards a agency is a cross subsidy which volition larn reflected inwards some savings inwards other departments every bit the cost would survive higher if mortal services were used.
Also given the attain of the Postal Department, it is non possible for mortal services to attain the rural areas as well as fifty-fifty inwards example they do, at that topographic point are fourth dimension issues of delivery. The Postal Department delivers the best. Notwithstanding these advantages, the fact that applied scientific discipline as well as mortal services are catching upwards inwards a large agency the threat of loss of concern to Whatsapp as well as courier services is real.
The authorities has been working hard to brand diverse departments business office inwards a to a greater extent than effective manner. It is solely a thing of fourth dimension earlier the Republic of Republic of India Post comes nether active review. The creation of the Republic of Republic of India Post Payments Bank is a expert measuring as well as though the progress of these banks has been slow, at that topographic point is compass for this venture to succeed given its reach.
But at that topographic point are reforms which tin survive implemented for the other services.
Revamp pricing
First, the pricing construction has to survive revamped every bit such heavy losses cannot survive sustained. Differential pricing based on location tin survive considered alongside the rural areas getting a subsidy. The other centres would receive got to survive made to pay the total cost. Hence an inland missive of the alphabet tin survive priced at ₹4 if sent from a rural mail business office as well as ₹10 from others.
Second, mail business office spaces should survive leveraged to earn rent. As fiscal inclusion includes also non-banking products, these tin survive sold inwards mail offices past times the usual funds or their agents.
Third, the existing staff tin survive trained to sell fiscal products similar insurance as well as usual funds inwards rural areas as well as a committee earned past times the department.
Fourth, the mail offices tin survive integrated alongside the eNAM first where terminals tin survive kept inwards these offices for usage past times farmers. Further, dak sewaks tin survive used to also shape a link alongside the agricultural markets (eNAM) every bit they receive got similar a shot interface alongside farmers as well as tin survive given the responsibleness of spreading awareness every bit good every bit survive the link alongside the marketplace position prices.
There is considerable compass to leverage the acquaint strengths of Republic of Republic of India Post to non only larn inwards financially sustainable but also maximise the utilisation of the infrastructure to link it alongside other goals of the authorities to exercise a virtuous cycle.
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