Will create monopolistic tendencies and discourage competition
April 21, 2006, The Hindu Business Line
New Delhi

The courier industry has expressed its concern over the proposals of the draft Postal Bill released by the Government on Thursday.

Mr Chris Callen, Country Manager of DHL Express, said that while he was delighted that the Government has decided to enter into a debate, there are concerns about three main provisions in the draft Bill.

“First, the definition of a `letter’, preventing courier companies from delivering letters below 300 gm, distorts the level playing field.

Second, there is no need to appointment a postal regulator in the industry which is doing well on its own adding to the economy. Third, we are very concerned about the 10 per cent of revenue levied for USO fund.

“We will ask for transparency in the accounts of the Postal Department to know how the money will be utilised. Implementation of the Bill in the current form will put a number of courier companies out of business.”

Mr Anil Agarwal, President of Asssocham, said: “Preventing the courier industry from carrying postal packets below 300 gm will create monopolistic tendencies and discourage competition. It should be left to the consumers to decide whether they would like their postal deliveries through State-owned post offices or by way of private couriers.”

Mr Pradeep S. Mehta, Secretary-General of Consumer Unity and Trust Society, said: “If the proposed amendments are enacted, it would imply that consumers are denied a choice. Even if they have urgent time-bound documents they will have to perforce use post. This will also wipe out a vibrant segment of our service sector economy and with it, over a million jobs.”

Defending the decision, the Postal Department said: “The monopoly over a specific part of the letter mail up to a specified weight limit is essential as the

Department of Posts is required to fulfil the Universal Service Obligation (USO), which involves postal coverage to financially non-viable areas also at affordable rates for the common man. Courier companies are operating only in creamy areas and big business centres with sole motive of profit without corresponding responsibility towards deprived class of people residing in rural, remote, hilly, tribal and inaccessible.”

Mr P.C. Sharma, CEO of XPS Courier & Air, said: “The express and courier segment provides employment to a large section of the population, essentially members from the economically weaker sections, who would be rendered unemployed. The Government should, therefore, review its decision and look into the interests of the community at large.”

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