The Hindu Business Line : Indiapost enters goods transport sector

The Department of Posts on Monday launched a goods transport service in Mumbai using hired vehicles. Initially the service, branded as `Logistics Post,' would operate on 30 dedicated destinations from Mumbai.

Indiapost will pick up and deliver parcels of above 50 kg at fixed rates. The tariff for a full, nine-tonne truckload from Mumbai to Pune is Rs 5,379 and for a seven-tonner, Rs 5,413.

Individual parcels will be charged based on weight, under various slabs, the maximum rate being Rs 1.35 per kg for parcels up to 100 kg, the minimum tariff being as low as 60 paise per kg for cargo of 7 tonnes and above.

The Department, which has tied up with a private transport operator for vehicles, is expected to earn a margin of around 15 per cent, said a senior official associated with the new logistics service.

Trade sources said Indiapost rates are more or less on par with the market rates, although there are some private operators who offer lower rates on a selective basis.

Mr R. Ganesan, Secretary, Department of Posts, said the service would be launched in three more States - Tamil Nadu, Gujarat and Uttaranchal - shortly.

"We hope to make Logistic Post a national service by June," he said.

Inaugurating the service, Mr Ganesan said the success of Speedpost and Business Post has encouraged the department to enter new areas that would help it to enhance its revenues.

The Department is expected to earn Rs 950 crore from the Business Post this year as against Rs 747 crore last year.

Ms K. Noorjehan, Chief Postmaster General, Mumbai, said Logistics Post would initially target Government cargo. Several Government departments regularly use private transport to move their freight. The problem here is that these departments have to obtain prior approval for freight rates from their higher authorities, which is time consuming.

But Logistics Post being a Government department itself, the formality of obtaining prior approval would not be required, she said.

There is strong demand from corporates and banks for the Bill mail service of Indiapost. Bulk movement of bills from printing presses to distribution centres is also a growing revenue area for Indiapost, she said.

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