Courier turf war with India Post hotting up

While the ministry of communications and IT is busy changing the Indian Post Office Act to wrest an exclusive monopoly over letters that weigh up to 500 gms, the Rs 4,000-crore private courier industry has demanded privatisation of all postal services in the country. The industry has drafted a Position Paper on the Post Office (Amendment) Bill which it has marked to President A.P.J. Abdul Kalam, Prime Minister Manmohan Singh, UPA Chairperson Sonia Gandhi and the Ministry of Communications and IT, with requests to reject the Bill’s unfavourable provisions. Amendments proposed by the government to the 108-year-old Post Office Act say that private couriers should pay Rs 10 lakh for registration and Rs 5 lakh for yearly registration renewal. Couriers with international activity are to pay Rs 10 lakh while domestic-only operators are to pay Rs 50,000 as per draft rules. The amendments also suggest a penalty of up to Rs 10 lakh for violations by private couriers, and seek to make senior management of courier companies responsible for wrongs committed by their employees.

Largely unregulated this far, the proposals have the courier industry up in arms. In its fight against the Bill, the industry has said that the “real opportunity” in the letter delivery business can be unleashed only if the government undertakes “deregulation of postal services and the efficiency benefits that result.” “The private courier industry is 50 years old, so why the question of state monopoly and the private sector being illegal,” says R.K. Saboo, Chairman, Express Industry Council of India (EICI). The courier industry favours self-regulation to the proposed Mail Regulatory and Development Authority (MRDA) says it need not share 10 per cent revenue with IndiaPost to fund its Universal Service Obligation (USO) targets. “The DoP’s USO can be funded by adopting a more commercial model,” says the Position Paper finalised on Tuesday by EICI, which points out that some 2,500 private courier players will be affected if the courier industry is shackled. EICI’s contention, made in its letters to political leaders, is that the private industry competes with Speed Post and Express post, not the conventional letter delivery business. For the Department of Posts (DoP), however, the USO is extracting a toll, especially as it is forced to expand its service network to regions that have bare minimum industrial activity. “That is why the government has not lost interest in the Post Office (Amendment) Bill at all, and, in 2006, it has come closest to introduction in Parliament than ever before,” says an industry watcher.