The recent legislative electoral wins for the ruling Bharatiya Janata Party (BJP) are partly a verdict on its policies of the past three years and partly due to anti-incumbency factors working in its favor. Electoral politics in India is perhaps the most complicated in the world. With no major legislative elections till 2019, albeit one state, the government should step on the pedal and take advantage of this two-year window to implement some path breaking if not big bang reforms. Many issues require attention, but there are three that will have far-reaching impact and give a strong visceral feeling of progress to its citizenry.

First, the legal system is the elephant in the room. People have suffered the painfully slow system for decades. The court visits and expenses break their spirit and turn their hair gray. This broken system is the biggest and most urgent crisis in India, and no political party has really taken a serious look at this problem and offered any comprehensive solution. This is because of two reasons. It suits parties to have a lethargic system since political parties increasingly have criminal elements in their fold with ongoing cases. And an exponential rise of cases as a result of the population explosion, combined with an outdated system of procedures and processes. This problem impedes private corporate sector progress too, with foreign investors often citing this as a major reason for not investing in India. The government, along with the judiciary, must come up with creative ideas.

Second, on the economic front, Prime Minister Narendra Modi fought the 2014 general election on the promise of minimum government. Not much has moved on that front. While the debate on more vs less government is an ideological one and there are pros and cons to both, there are certain areas where, as Margaret Thatcher put it, “the government has no business being in business.” Hotels, airlines and certain non-strategic manufacturing sectors need to see a swift government exit. Unfortunately, the Indian bureaucracy is especially status quoist and unimaginative. Abysmal performance and boundless corruption thrives in these sectors.

Courtesy of low oil prices, the government has enjoyed a long leash on the fiscal space front and has felt no urgent need to push the privatization program for revenue shortfall. Nonetheless, the government must implement the program for the sake of getting rid of inefficiencies. It should reenter this space with renewed enthusiasm and determination. The resources from privatization should be utilized in health care, education and modernizing armed and police forces. Privatization is a very sensitive topic since it involves restructuring and dealing with powerful unions, but the next two years provide enough legroom to implement a decisive program. Not share sale, which is a privatization-lite approach, but shutting down inefficient programs and units and the sale of profitable ones.

Third, the Swachh Bharat Abhiyan (Clean India Campaign) is well intentioned but perhaps lacks innovative thinking. It’s not an easy problem to tackle because of behavioral and cultural issues in India. The country remains as dirty as it was three years ago. African nations have tackled this problem in a better fashion. Big cities all over the world like London, Toronto and Paris have successful programs where garbage collection and maintaining the city furniture is completely in private hands. The private company is given a return and also the right to use the refuse to generate electricity outside the city as an added incentive.

In India, these responsibilities are with the municipalities, which are rapaciously corrupt and not incentivized at all. The issue requires courage and political will because the municipalities in India are tiny political party fiefdoms and a source of revenue through corruption. This is a state issue, but the center can start with some guiding principles for states to follow. Something new and brave has to be done about this issue.

These are just three issues but perhaps the most important ones. The BJP might get reelected even if it doesn’t do much in the next two years because of a weak, unmotivated opposition, and caste and religious-related political machinations. But if the government truly wants to win the respect and trust of the people across the spectrum of urban and rural, it must do something about these issues. The resolution will have a trickle down or push up effect on other sectors, too, like infrastructure and foreign investment, which are pet projects of Modi. Failing which, we just stumble along in the crowded flea market of perpetual easy going achievers.

*[This article was updated on April 16, 2017.]

The views expressed in this article are the author’s own and do not necessarily reflect 51�Թ�’s editorial policy.

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The Indian power sector has come a long way since the sweeping reforms that resulted from liberalization in 1991. The state-dominated power sector was inefficient, hamstrung by lack of maintenance and inadequate investment. The sector was directed to provide very cheap electricity, often at a tariff lower than the cost of production.

After two decades of reform, the unbundling of the power sector and private sector participation, India has become the world’s fifth-largest electricity generator with a capacity at 243 gigawatts (GW). With strong economic growth, the energy demand is estimated to grow from 1,127 terra watt hours (TWh) in 2013 to 3,793 TWh in 2032. The supply, however, has risen by a 5.5% compound annual growth rate (CAGR) from 2007 to 2014, but is expected to grow at a much faster pace in the years to come.

In terms of the current energy mix, thermal energy’s installed capacity stands at 168GW, hydropower at 40.5GW, solar at 3GW and other renewable energy resources at 32GW. The current renewable energy share of around 28% is expected to increase sharply as solar energy becomes a more viable option. (India has huge solar energy potential with average solar irradiation of 5.1 kilowatt hour per square meter (kWh/m2) each day, while the United States’ solar irradiation stands at 4.68kWh/m2 per day).

The energy market has a positive investment climate and has attracted $9 billion of foreign direct investment (FDI) since 2000. There are several domestic and international players active in the renewable energy space, especially in the solar sector. Companies such as First Solar and Sun Edison are success stories in India.

In spite of all the developments, the annual per capita consumption of electricity is low by global standards. 300 million people lack supply of electricity. The state electricity boards, which manage the supply of electricity, are in dire financial state. They are often under pressure to keep prices low by their political bosses, who use low power tariffs as a sop to get elected.

Approximately 700 million Indians live in villages and lack uninterrupted supply of electricity. They use kerosene as their major source of energy apart from cow dung, firewood and crop residue for cooking purposes.

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The reasons for this dismal state are political and bureaucratic apathy, as well as the lack of economic viability to connect these villages to the grid. With the advent of solar power along with the increased affordability of solar systems, the federal government has promised to provide electricity to every village in India by 2017-18.  There are several new business models in the energy market that are being utilized to achieve this goal. A few innovative companies provide electricity through solar panels on a pay as you go system in far-off rural areas to reduce payment risk, and they use local corner stores as charging vendors for the electricity supply card.

Two other areas of concern that have a direct link to economic growth are industrial and agricultural sector power supply. The dependence of the industrial sector on diesel generators adds a significant slice to the cost of industrial production, with tariff level of $0.25/kwh compared to $0.10/kwh from the grid connected electricity. With roof-top solar models and hybrid solar/diesel systems in the market, this problem is also being slowly addressed. In the agricultural sector, lack of supply of regular electricity impacts regular irrigation supply, which affects crop productivity. Currently, there are 10 million diesel-run water pumps in operation, which are slowly being replaced with solar water pumps.

India faces a significant challenge to provide reliable electricity to 1.3 billion people. If the country is to become an economic power house, it will have to quickly address this problem as more options and resources are at its disposal than ever before.

The views expressed in this article are the author’s own and do not necessarily reflect 51�Թ�’s editorial policy.

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