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Inviting a Bigger Crisis

Electricity (Amendment) Bill, 2020

The proposed Electricity (Amendment) Bill, 2020 aims to reduce subsidies and push for privatisation, especially in the distribution segment of the power sector. Undertaking structural changes in a core sector at a time of crisis from the COVID-19 pandemic and its economic effects defies logic. The proposed amendments are not only anti-people, but they also fail to address the long-term crises in the sector and will only accelerate its deterioration. The central government must hold off on passing any hasty legislation on the subject and adopt a more scientific and less ideological approach to deal with the travails of the power sector.

The Electricity (Amendment) Bill, 20201 is a rehashed version of a bill that the central government has been trying to pass in Parliament since 2014. Different versions of this bill have been circulated since 2014, the latest coming at a time when India is trying to fight the COVID-19 pandemic and figure out a way to deal with the economic fallout of the prolonged nationwide lockdown. The overall aim of the proposed bill is to reduce subsidies in the power sector and push for privatisation, especially in the distribution segment of the power sector. This move comes at a time of severe economic slowdown, when salvaging productive capacity, jobs, wages, and demand and supply in the economy should be the priority. Undertaking structural changes, which are likely to further change the centre–state relationship and increase costs of an essential commodity, in a core sector such as electricity at such a time defies logic.

A Brief Contemporary History of the Power Sector

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Updated On : 13th Oct, 2020

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