IndiaPost: Reclaiming Autonomy in the Digital Age
- Bruhaspati Samal –
India Post, the world’s largest postal network, stands as a living testament to India's administrative evolution, social integration, and financial inclusion. Established formally in 1854 under the colonial regime, it redefined communication in the subcontinent with the introduction of uniform postage and the creation of an all-India postal structure. India Post has never just been about delivering letters—it has been about delivering trust, dignity, and connection, especially to the remotest corners of the nation shouldering the responsibility of keeping the country connected—geographically, emotionally, and economically for nearly two centuries. Its legacy has only grown stronger through its three principal verticals: Mail services, Financial services through the Post Office Savings Bank (POSB), and Insurance through the Postal Life Insurance (PLI) and Rural Postal Life Insurance (RPLI) schemes. With over 1.65 lakh post offices, nearly 90 percent of which are in rural India, India Post is not merely a department—it is a lifeline. But in the last decade, particularly after 2018, new waves of strategic partnerships and policy experiments have sparked concerns about a slow dilution of its autonomy and the infiltration of corporate interests.
The creation of India Post Payments Bank (IPPB) on 1st September 2018 was intended to provide inclusive digital banking through the post office network. While the idea had promise, its execution led to troubling developments. POSB, which holds the distinction of being Asia’s largest savings bank, with over 25.83 crore active accounts and Rs.12,68,542 crore in savings deposits (as on 31.03.2023), began to see its identity fade as the government initiated moves to merge these legacy accounts with IPPB. During the fiscal year 2021–22 alone, POSB processed transactions worth Rs.8.19 lakh crore and opened over 1.67 crore new accounts. It is a trusted institution with unmatched grassroots reach and simplicity, yet its distinct operation is now being absorbed into a loss-making enterprise. IPPB, not yet profitable and dependent on state support, stands in contrast to the time-tested success of POSB. This creates an avoidable conflict of interest and undermines the operational clarity of India Post's financial mandate. And now, adding salt to the injury, on May 22, 2025, IPPB announced a strategic partnership with Aditya Birla Capital Limited to enhance the accessibility of loan products across India.
The story doesn’t stop there. In 2021, India Post entered a tie-up with Bajaj Allianz Life Insurance Company (BALIC) to market annuity and term insurance products through its network. This raised eyebrows because India Post already has its own insurance arms—PLI and RPLI—which are arguably among the most beneficial insurance products available in India. These schemes offered a total sum assured of Rs. 4,74,243 crore across 3,37,52,778 lakh policies as of March 2024. With higher bonuses, low premium rates, and an impeccable record of service, these postal insurance products have long been the insurance backbone of rural and semi-urban India. Promoting a private insurance partner’s offerings through the same channel risks cannibalizing PLI’s market share and creating internal competition. It also weakens the morale of the India Post workforce, which has been trained and committed to promoting postal insurance schemes.
Further complicating the situation is India Post’s engagement with corporate logistics partners like Amazon and Shiprocket. In 2023, India Post signed a Memorandum of Understanding with Amazon India to deliver customer packages using its vast reach, particularly in hard-to-access rural areas. This partnership tripled Amazon’s parcel volume through the postal network in 18 months. Similarly, a tie-up with Shiprocket, a shipping aggregator, was launched to provide last-mile logistics for e-commerce sellers, predominantly startups and SMEs. These ventures may appear to capitalize on India Post’s infrastructure for commercial utility, but they also raise serious policy questions.
While leveraging the postal network for e-commerce logistics is not inherently problematic, the prioritization of private business interests over public service could shift the department's ethos from citizen service to profit-centric delivery. It’s worth asking whether postmen and postal vehicles should be repurposed to handle e-commerce packages at the cost of traditional services. Already there are signs of increased workload, logistical confusion, and diluted service standards in routine mail delivery. The department originally intended to serve the nation and especially the under-served, risks being reduced to a contract delivery agent for corporate India.
These developments also have direct repercussions on the workforce of India Post. The shift in operational focus due to private tie-ups has created an identity conflict for employees. The Department of Posts' skilled cadre including Gramin Dak Sevaks is being stretched to accommodate corporate parcel deliveries while maintaining their core responsibilities. Many are now required to promote third-party insurance and banking products without adequate training or incentives. During marketing of such third party products, the valued customers of India Post start asking, “Are you from Bajaj Allianz or from India Post? Now, they may ask, “Are you from Aditya Birla Capital Limited?” How embarrassing and offensive really such questions are for an employee proudly wearing the Identity Card of India Post?
On the stakeholder front, particularly for rural users, the erosion of public service in favour of private partnerships could mean loss of trust and eventual withdrawal. Citizens accustomed to secure, low-cost, high-reliability services may find themselves dealing with the pricing models and service quality of private players masked within the India Post brand. This blurring of lines could lead to reputational damage in the long run, weakening India Post’s foundational goodwill. It is also important to highlight that all these developments occur in an ecosystem where India Post has been historically underutilized. As the custodian of savings and social welfare in rural India, it could have been turned into a financial powerhouse akin to a rural development bank or nationalized insurer. Instead, it is being nudged towards becoming a passive facilitator of private profit under the garb of modernization.
To reclaim its autonomy and reposition itself as a central institution in India’s digital and economic future, India Post must be empowered through a new legislative and administrative framework. The government should grant the Department full operational autonomy to run its financial, mail, and insurance businesses without overlapping mandates from newer institutions like IPPB. India Post’s core verticals—POSB, PLI, and mail services—should be protected and modernized with in-house resources. Strategic investments must be made in upgrading digital infrastructure, automating logistics, and training employees—not for selling third-party products but for delivering enhanced public services. India Post should also revisit its MoUs with private corporations through an independent review committee that includes postal unions, finance experts, and citizen representatives. The principle of public interest must take precedence over private profit. Existing agreements should be renegotiated or discontinued if found detrimental to the Department’s self-sufficiency or service quality.
To mitigate internal conflicts, the government must ensure that no external financial products are sold in competition with India Post’s own offerings through the same channel. India Post must be allowed to create and manage its own suite of competitive financial and insurance products in the digital age, tailored to the needs of its core demographic—rural and middle-class India.
In conclusion, India Post is not just another government department. It is an institution built on trust, continuity, and public service. With its unparalleled network and proven legacy in delivering both social and financial services, it holds the key to inclusive growth in digital India. But to fulfil that promise, it must be shielded from exploitative partnerships and given the space to breathe, innovate, and thrive on its own terms. The government must act with vision and responsibility—protecting what is truly India’s and empowering India Post to serve smarter, not as a shadow of corporate interest but as the vanguard of national service. Will the Central Govt. allow freedom and flexibility to the Postal Department with a separate Ministry as Ministry of Posts so that it could restructure itself and operate competently with functional autonomy and financial independence having a separate budget and control by the Department of Posts?
(The writer is a Service Union Representative and a Columnist. eMail: samalbruhaspati@gmail.com, Mobile: 9437022669)
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