The Ministry of Posts and Telecommunications has signed an agreement with a Malaysian firm to introduce new technology in the country’s 4,700 post offices and modernize services provided.

Post and Telecommunications Minister Mahinda Wijesekera yesterday signed the agreement with iTopia’s Sri Lanka representative to strengthen on line and E-post services at post offices.

The Minister said that Sri Lanka cannot continue with the age-old traditional methods in the 21st century.

He told The Island yesterday that after Sri Lanka Telecom was partly privatized and savings in the postal department were handed over to the National Savings Bank, the system carried out by the Postal Department had become outdated and its earnings had been considerably reduced.

"We have lost our major income sources. However, now, we are determined to increase income through modern technology especially by improving our services in rural areas," the Minister said.

The Malaysian firm would fund the entire project and further discussions are being held so that the country’s post offices could get a share of 20 to 25 per cent of the income generated through modernisation, Wijesekera said.

He said 26 post offices were selected as pilot projects and would function from January 21.