Source: BloombergQuint
It is an established fact that a robust power sector provides
one of the fundamental underpinnings for modern socio-economic
development. While a series of legislative reforms by the
government – beginning with the plan in 1990s to galvanise
private sector investment in this sector and resulting in the
Electricity Act, 2003 as a comprehensive legislation governing this
sector – have sought to modernise different aspects of this
sector, one of the peculiarities of the current architecture is
that the private investor or producer inevitably deals with a
state-owned monopoly for distribution.
It is indeed true that some segments of the sector have been
opened up to private investment, and with reasonable success so
far, however, the state and its instrumentalities have assiduously
resisted the opening up of the most inefficient segment of this
sector, i.e. the distribution and retail sale of electricity, to
private investment and competition.
