Immediately after being sworn in, our new Chief Minister ordered the supply of tariff-free electricity to farmers along with the waiver of their outstanding, unpaid electricity dues.  This has remained a strongly debated and controversial subject.  But, what are the real issues behind this debate?

The past few days gave us good, strong showers of rain that were long overdue.  But heavy rains also brought with them longer power cuts to many homes.   But, to have power interruptions we do not need heavy rains - the current supply could be knocked out even by the weakest of winds and the lightest among drizzles.  While such power cuts certainly are an inconvenience and a nuisance to us consumers, they also reflect a far more serious problem.  They indicate inefficiencies in our electrical network that directly result in huge losses to the public money.

The recent oil price hike and India’s frenetic efforts to leverage its diplomatic strength for oil security raise important questions about our future energy needs. Do we have a viable and coherent energy strategy, or are we merely responding in a knee-jerk manner disregarding our long-term interests? A serious debate is necessary on these vital issues.

One sector, the management of which will make or mar India’s economic future is electricity. For over a decade we have been incessantly talking of power sector reform, and yet the results, so far at least, have been disheartening. We focused on the one area which has been our strong point – generation, and ignored distribution which is our weakest link. As a result, hardly any private investment – domestic or foreign – materialized. Only about 6700 MW private generation capacity came up – a third of the expected investment.