Assessment of Indian power sector reform through productivity analysis: Pre and post electricity Act, 2003

Abstract

Structure of power sector all-round the world is changing from regulated to deregulated environment to enhance the technical efficiency and financial viability through private sector participation thereby increasing competition. Asian developing countries are also motivated by the restructuring process and India is no exception to it. The Indian power sector has undergone significant changes since 1990 by opening gateway for the independent power producers (IPPs). This paper discusses the major policy and regulatory changes occurred since 1991 in chronological order in section III. Technical and economical performance of the power sector has been compared in relation to the pre and post electricity Act, 2003. In continuation, Malmquist Productivity Index is employed to determine productivity change for the period 1999–2005. The procedure adopted and the results are explained in details in section VI. The results of Malmquist Productivity will help to investigate the productivity change attributed by technological aspects.