By: Conor Eckert, `14
For the developed world, energy access is something that we take for granted. Sixty eight percent of all American Jobs are in services; businesses could not fathom working without an efficient and active energy grid. Our heavy service industry is only rivaled by India’s who accounts for sixty percent of its GDP. However, unlike the United States, India has a problem with its power grid. Centralized reforms and strong coal regulation have destabilized the power grid. My research will examine what role privatization has on accelerating India’s energy developments.
India’s energy has been centralized for decades following Indira Gandhi’s socialist reforms. Her reorganizations originated from a strong desire to improve the social welfare of the Indian population in the 1970s. By aiming her focus at industrial and natural resource sectors, millions of new jobs were created. However, as India has joined the world economy, government inefficiencies pose a threat to business development. The question arises; does privatization of India’s energy production benefit its businesses? Privatization has been experimented in a couple of states within India and has shown promising results. Case studies have shown that the decentralized change in management incentivizes businesses to offer superior services but at a more expensive price.