Spike Milligan may have had to wait a few days to get electricity but millions in India are still waiting to be connected and may have to wait a lifetime more. India’s power sector riddled with holes that of capacity shortages, frequent blackouts, poor reliability, and deteriorating physical and financial conditions. This underdevelopment of the power sector has far reaching consequences. In addition to constraining agricultural and industrial development, the losses incurred by this sector put enormous pressure on the central and states’ coffers.

Power is a critical component of any economy’s infrastructure and without its development, economic growth is severely hindered if not made impossible. It is an essential requirement of all facets of human life and is recognized as one of the basic human needs.

An economy’s growth, development, ability to handle global competition is all dependent on the availability, reliability and quality of the power sector. The demand for power is growing exponentially and the scope of growth of this sector is immense.

As per the Constitution of India the power sector is mentioned in the Concurrent List and is under the purview of the Centre and the states. This sector is dominated primarily by Public Sector Undertakings. The state and Central Government account for 58% and 32% of the generation capacity respectively while the private sector accounts for a mere 10%. A major part of the transmission and distribution factors are handled by the state utilities. The private sector is slowly making its presence felt in the power sector in distribution and is making a foray into transmission. Power sector had been funded mainly through budgetary support and external borrowings were opened to private sector in 1991.