Monday, May 28, 2012

Postal department's 6.5% discount on gold and Government's duty

From when gold became an essential commodity for the survival of human beings? There is no doubt that yellow metal holds a special place in Indian society. People often struggle to buy a piece of it at any cost. Yet, all these factors don't justify the decision of Postal depatment to sell gold at a special discount of 6.5%. That too at a time when rupee is accelerating its downward journey, petrol prices are flying over the head, budget deficits are jumping from hills to mountains.

Well this is the full news,

Government’s Press Release

"Delhi Postal Circle has announced a special discount on purchase of Gold Coins of any denomination in any quantity on the eve of "Guru Pushy Nakshtra" which falls on 26th May 2012. The gold coins are available through 31 Post Offices in National Capital Territory (NCT) of Delhi. Customers can walk into the nearest identified Post Offices to avail special discount of 6.5%. This discount is valid only for 26th May 2012.

This offer is available in Post Offices in Delhi identified for the sale of Gold coins. These Gold coins with unique logo of India Post are available in denominations of 0.5 gm, 1 gm, 5 gms, 8 gms, 10 gms, 20 gms, and 50 gms for sale across the counters at all the important Post Offices. These coins are of 24 carat 99.99% purity from Valcambi, under Swiss certification and are available in tamper proof packaging. These Gold Coins have the benefits like internationally recognized certification, low risk of duplication, quality packaging, product standardization and numbering with assayer certification"

Some questions

It’s a good idea to sell gold coins through post offices so that people can buy pure and certified gold through its branches. At the same the press release raises two important questions,

1. Why postal department is giving 6.5% off on price for a non-essential commodity like gold? That too at a time when the gold prices almost touches the shiny surface of moon.
2. Why only in NCT Delhi?

Postal department created and running by government money should make it more responsible towards needs of the citizens at the same time it should make profits to justify its existence. It’s not a hidden fact that postal is not a money minting machine for government. Especially at a time when the department is struggling to retain its market share and profits against private courier companies. So why department is giving 6.5% subsidy on gold? More interesting thing is why it is restricted to NCT Delhi? If postal department wants to do something like that then why it’s not an all India offer instead of restricting to 31 post offices in NCT Delhi? After all, all of us can't go to Delhi to buy gold with special discount!!!


It’s understandable when government empties is pocket to give subsidies on essential commodities. Government’s urging to give quality products to citizens is also understandable. But not 6.5% discount for a non-essential commodity like gold.


Photo Courtesy: IndiaPost, Government of India, later edited to suit this article

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