Industry & Economy
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Economic Survey
'Postal subsidy rationale should be clarified'
Our Bureau
New Delhi
,
July 7
THE Economic Survey 2003-04 has urged the Government to review the rationale and size of postal subsidy projected at Rs 1,204 crore for the current year. The Survey has said that though the deficit has dropped from Rs 1,550 crore in 2000-01 to Rs 1,364 crore in 2002-03, clarifying the rationale, the mechanism and the size of the subsidy constitute an important policy question at this juncture.
All services of the post offices are currently subsidised.
User charges in the postal system covers about 78 per cent of the costs.
The biggest subsidy is on money orders with a per unit subsidy of Rs 28.50. This alone adds about Rs 331 crore to the postal deficit.
Even registered post, which is generally used by commercial establishments, has a subsidy of Rs 16 per unit adding another Rs 357 crore to the deficit.
The Survey has pointed out that the advent of computers and communications has had a profound implication on the postal system. Telegrams have lost ground to faxes, long distance telephony and e-mail.
Therefore, the Department of Posts has undertaken a project to induct new technology, modernising processes and improving customer experience.
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