Term Paper of B.E. 26th Oct 10 Raj

SUBJECT:BUSINESS
ENVIRONMENT
TOPIC :- PRIVATE SECTOR
PARTICIPATION IN POWER
SUBMITTED TO :-
MR.LOKESH JAS RAI

SU
BMITTED BY :-
MD.
WASIM ALAM
ROLL NO :- A-64
SECTION :- R1002
REG. NO :- 11012715
DATE OF SUB :- 5-NOV-
201O
PRIVATE SECTOR PARTICIPATION IN POWER SECTOR IN INDIA Page 1

 TABLE OF CONTENTS
 ACKNOWLEDGEMENT
INTRODUCTION
OBJECTIVES
REASONS FOR INVITING PRIVATE SECTOR
PROBLEMS ENCOUNTERED
CHALLENGES AND RISKS
REVIEW OF LITERATURES
SUMMARY AND CONCLUSION
REFERENCES

ACKNOWLEDGEMENT
I wish to express my deepest gratitude and warmest appreciation to
the following people, who, in any way have contributed and inspired
me to the overall success of the undertaking study:-
TO Prince Sir, for his guidance and support in the duration of the
study.
To My Friends, who have been unselfishly extending their efforts
and understanding. To My Parents who have always been very
understanding and supportive both financially and emotionally.
I would also thank My Institution and my faculty members without
whom this project would have been a distant reality.
And above all, to the Almighty God, who never cease in loving us
and for the continued guidance and protection.

MD.WASIM ALAM
INTRODUCTION
Major Players and Presence in value chain:-

Public Sector
• NTPC
• National Hydro Electric Power Corporation
• Nuclear Power Corporation
Domestic Private Sector
• Tata Power
• RPG Group - CESC
• Reliance Energy
International Private Sector
• China Light and Power (CLP)

• Marubeni Corporation
The electricity sector in India is predominantly controlled by Government of

India's public sector undertakings (PSUs) but the private sector is also
catching up fast. India is world's 6th largest energy consumer, accounting for
3.4% of global energy consumption. Due to India's economic rise, the
demand for energy has grown at an average of 3.6% per annum over the past
30 years. In March 2009, the installed power generation capacity of India
stood at 147,000 MW while the per capita power consumption stood at 612
kWH. The country's annual power production increased from about 190
billion kWH in 1986 to more than 680 billion kWH in 2006.
India faces a serious shortfall in power generation. During the tenth plan,
only 23,000 MW of capacity was added against the original target of 41,000
MW.
The Eleventh Plan (2007-12) called for the addition of 78,000 MW of power
from all sources. It is unlikely that this target will be realised, though a late
surge during the past few years has resulted in the rapid addition of

generating capacity. It is envisioned that the final capacity addition at the
end of the Eleventh Plan will be somewhere between 60,000 and 65,000
MW. The Twelfth Five-Year Plan (2012-17) is even more ambitious,
calling for the addition of over 100,000 MW of power. Planners are
confident of realising this target given that the policy reforms of the
Electricity Act would have had time to play out, leading to greater private
sector participation is concerned.
The Government of India has an ambitious mission of “POWER FOR ALL”
BY 2012. This mission would require that the installed generation capacity
should be at least 200,000 MW by 2012 from the present level of 144,564.97
MW. Power requirement will double by 2020 to 400,000MW.
The Indian Power Sector was opened with much fanfare to private
participation in 1991 to active the increase in generating capacity and to
improve the system efficiency as well.
India has the fifth largest generation capacity in the world with an installed
capacity of 152 GW as on 30 September 2009, which is about 4 percent of
global power generation. The top four countries, US, Japan, China and Russia
together consume about 49 percent of the total power generated globally. The
average per capita consumption of electricity in India is estimated to be 704
kWh during 2008-09.
However, this is fairly low when compared to that of some of the developed
and emerging nations such US (15,000 kWh) and China (1,800 kWh).The world
average stands at 2,300 kWh. The Indian government has set ambitious goals in
the 11th plan for power sector owing to which the power sector is relaxed for
significant expansion. In order to provide availability of over 1000 units of per
capita electricity by year 2012, it has been estimated that need-based capacity
addition of more than 100,000 MW would be required. This has resulted in
massive addition plans being proposed in the sub-sectors of Generation
Transmission and Distribution.

OBJECTIVES (INITIATIVES)
• Allowing foreign equity participation up to 100 per cent in the power
sector under the automatic route.
• Encouraging the private sector to set up coal, gas or liquid-based

thermal projects, hydel projects and wind or solar projects of any size.
• Constitution of Independent State Electricity Regulatory Commissions

in the states.
• Deregulation of the ancillary sectors such as coal.
• Introduction of the Electricity Act 2003 and the notification of the

National Electricity and Tariff policies.
• Provision of income tax holiday for a block of 10 years in the first 15

years of operation and waiver of capital goods' import duties on mega
power projects (above 1,000 MW generation capacity).
• Un-bundling of the State Electricity Boards (SEBs) into generation,

transmission, and distribution companies for better transparency and
accountability.

REASONS FOR INVITING PRIVATE
SECTOR
In 1990, the situation facing the energy sector in India was roughly as follows.
The central government – the conventional source for funding power projects
-was believed to have reached its limit as far as funding was concerned. The
Indian electricity sector had virtually no surpluses to make available for
investment. The World Bank had stated in 1989 that requests from the
electricity sector of developing countries added up to $100 billion per year. In
response, only about $20 billion was available from multilateral sources,
leaving a gap of about $80 billion. Hence, it was suggested that the only
possible source of funds was the private sector and, in view of the fact that the
Indian capital market did not appear to be able to make a significant
contribution, that the foreign private sector should be welcomed.
It was also hoped that there would be a side-benefit regarding the unacceptably
low system efficiency of the state electricity boards. This efficiency would be
improved through the oft-claimed better management and higher technical
Performance of the private sector.
Further, in the case of private promoters, projects without foreign participation

are being completed as scheduled. For example, the chief promoter of the 235
MW Jegurupadu project in Andhra Pradesh, avoided delays by persuading
Indian financial institutions to invest even before any counter-guarantee was
obtained.

CHALLENGES AND RISKS
AS the Indian power sector is embarking on increasing the generation and

transmission capacities, key challenges lie ahead which also resulted the
historical underperformance.
The stakeholders in the power scenario are the generators- independent power
producers (IPPs) and/or state undertakings, the distributors (at present the State
Electricity Boards), the government (central and state) and the consumers
(commercial, industrial, and others), as well as households (with and without
electricity). Attention will now be focused on the problems noted by the private
producers and the electricity establishment in the course of constructing
new power plants.
The problems are as follows:-
 Renegotiations leading to delays
 Financial Problems
 Project Execution-Needs to be active
 Fuel Availability
 Equipment Shortage
 Land Acquisition and Environment Clearance

 Manpower Shortage
 Schedule Dependency on Transmission Lines
 Technical losses and Improvement of the T&D system
 Privatisation of the T&D system

RISKS
 Construction Risk
 Market Risk
 Fuel-Supply Risk
 Exchange Fluctuation Risk
REVIEW OF LITERATURE
• Critical evaluation of road infrastructure

in India: a cross-country view
Type: Research paper
Abstract
Purpose – This study aims to examine the current status of road infrastructure
in India, working out the gap in the availability of required length and the
quality of roads besides the comparison with other economies. It also seeks to
analyse the socio-economic-political environment in India to assess the
country's attractiveness towards private sector participation in road
infrastructure development.
Design/methodology/approach – The targets for the road sector development

set by the Government of India and the current road status of China are taken as
benchmarks to enumerate the existing gap in road development in the country.
Growth trends of the road sector and their impact on the manufacturing sector
have been worked out to assess the development of road infrastructure and its
impact on the industry in the country.
Findings – The study advocates that the present pace of road infrastructure
development is inadequate in India vis-à-vis other developing economies. The

quality of roads compared with China is far below expectations and this poor
hinterland connectivity is affecting the trade growth in the country.
Originality/value – The paper significantly contributes in assessing the state of

road infrastructure in India and highlighting the weaknesses while comparing it
with other developing and developed economies. The key issues identified are
of immense help to the policy makers in the country for having detailed insight
and correcting the road infrastructure development programmes.
Introducing competition in the power sector in India:

adoption of the US model
Type: General review
Abstract
Purpose – The twin objectives of power sector reforms in India – improving

efficiency and attracting private investment – are far from being achieved. It is
commonly acknowledged that competition in the sector can help achieve the
objectives of the reforms, but although the Electricity Act of 2003 promised to
usher in competition, even after seven years of its enactment there is very little
competition in generation and absolutely no competition in retail supply. This
paper seeks to find a road map for the introduction of competition in the power
sector in India by discussing and drawing upon the US model of deregulating
generation and retail supply whilst simultaneously keeping transmission and
distribution under regulation.
Design/methodology/approach – The study is a historical analysis of

deregulation in the US power sector and its relevance for India by drawing upon
both primary and secondary resources.
Findings – The introduction of competition in the USA has brought substantial

gains for the consumer and India can follow this model by mandating all
distribution utilities to procure their future requirement of power through open
competitive bidding. For retail competition, the system of provider of last resort
(POLR) with POLR price being fixed with reference to market price can be the
way forward.
Originality/value – This paper offers some practical and implementable

suggestions for introducing competition in the power sector in India.

• Knowledge management initiatives in
Indian public and private sector
organizations
Abstract
Purpose – There is no single way of achieving business success. The concept of

knowledge management (KM) builds on the existing management practices,
integrating them into a philosophy for improving performance. This paper aims
to understand the various dimensions of KM and how they differ in public and
private sector organizations in India. It also attempts to identify the dimensions
where one sector is better than the other and areas needing improvement.
Design/methodology/approach – The paper uses a sample comprising 16

private and public sector organizations. A convenient sampling scheme was
used. The extent of KM practices was evaluated with respect to dimensions,
namely process, leadership, technology, culture and measurement.
Findings – The paper empirically shows that private sector organizations fare
better statistically on all dimensions compared to public sector organizations.
Although the private sector is ahead of the public sector on the raw mean scores
of various dimensions, it has still a long way to go as the scores are below four
on a scale of five. The scores are just satisfactory and there is further scope for
improvement.
Research limitations/implications – The study uses a sample of four public

sector organizations and the findings may lack generalization. Therefore, it
would be interesting to verify the findings using a larger sample size.
Practical implications – The paper can serve as a best practice document for
public and private sector organizations interested in adopting KM for improving
performance.
Originality/value – The paper tries to bring forth concern areas for KM in

Indian public and private sector organizations.

• Convergence in ICT use expectations
between the public and private sectors:
An imperative or an indicator of
efficiency?
Abstract
Purpose – Examination of the challenges of dependence on the private sector of

public-sector projects is the central concern of the paper. With ongoing research
suggesting that dependence on the private sector is inevitable, this paper tries to
assess whether the dependence is an imperative or a yardstick for gauging
efficiency.
Design/methodology/approach – A literature review, consideration of flagship

projects as well as trends in implementation of ICTs in government have been
central to the development of analysis for the paper.
Findings – The research found that when the public sector is interested in
developing applications that require acceptance among citizens, then initial
support of the private sector is a necessity. Countries that have depended on
strict government control on delivery of internet-based services are finding out
that a degree of independence at the point of delivery tends to be more effective.
It is only after a passage of time post rolling out of web-based delivery of
services that measurement of service quality can be deemed to be a measure of
efficiency.
Research limitations/implications – This research was desk-based and reliant

on international flagship initiatives. There is a wide range of resource
endowments between developed and developing nations. This research showed
that developed nations are more appropriate for study of efficiency through
private-sector involvement, and private-sector engagement in web-based
government initiatives is an imperative in the case of developing nations.
Practical implications – Government agencies ought to be able to think more

expansively when they are developing applications for citizens, as there are a
variety of private sector solutions that can be used.
Originality/value – The theme itself is new in a context where new ways of

running government projects are constantly being revisited.

• Adaptation of Indian public sector to
market-based economic reforms: A
resource-based perspective
Type: Conceptual paper
Abstract
Purpose – Economic policy reforms, characterised by a market-driven,

privatised policy regime, are being adopted as a strategy by India to promote
economic development. As markets become liberalised, public sector
organisations face extreme vulnerability unless they can identify and develop
the competencies necessary to thrive in these competitive markets. This paper,
drawing on the resource-based view, aims to identify the pre-reform capabilities
of public sector organisations in India and similar developing country contexts
that would be relevant even in the post-reform context.
Design/methodology/approach – An interpretative and theoretical approach is

used to put forth the arguments and a framework is proposed to explain the
possibility of deriving competitive advantages from pre-reform capabilities in
the post-reform context.
Findings – Several unique capabilities of Indian public sector organisations can

be identified using the resource based perspective which can be leveraged in the
post-reform context. They have superior resource-picking capacity compared to
private firms, especially for government-regulated resources, international
financial assets and modern technologies. Their internal integrative managerial
systems and structures offer them an advantage in meeting the competitive
demands of speed and promptness. Under effective leadership, the loyalty of a
large workforce and their number of years of experience gives them an
advantage of effective coordination and knowledge sharing and flow. Also, their
capability in delivering economies of scale and scope due to their size and
supply chain integration gives them a cost advantage over others.
Practical implications – This paper takes a practical approach. It accepts the

existing organisational culture, processes and systems of public sector
organisations as given and matters of long-term change, and identifies existing

capabilities in the current organisational context that could help them survive
better.
Originality/value – Unlike most papers that focus on how policy changes affect
public sector organisations or those that conduct a comparative analysis with the
private sector on various parameters, the main focus of this paper is to identify
existing capabilities that can be leveraged by public sector organisations for
effective adaptation in the new scenario.
ICT and information strategies for a knowledge

economy: the Indian experience
Abstract
Purpose – The purpose of this paper is to describe the progress India has made
in its move towards a knowledge-based economy with details of how the Indian
Government has demonstrated its commitment to the development of
fundamental pillars of knowledge sharing infrastructure, knowledge workers
and a knowledge innovation system. Libraries are identified as key players in
building an inclusive knowledge economy (KE) for a country.
Design/methodology/approach – An empirical study of the initiatives taken by

Government of India as well as premier institutions and non-governmental
organisations in the area of information literacy, lifelong learning and
knowledge repository development was undertaken. These are reviewed to
report on the contribution each of them has made in the development of KE in
India.
Findings – The practice-based examples of how information and

communication technology (ICT) projects are influencing contemporary Indian
society and an account of government policies in regard to ICT implementation
and development towards a KE are presented. The impediments in the process
of KE in India are identified and recommendations are made.
Originality/value – This is an attempt to bring together initiatives and projects

initiated by the Government of India as well as other agencies aimed at

developing a knowledge-based society which will ultimately lead to a KE in
India.
• The role of technology in the emergence

of the information society in India
Abstract
Purpose – India is the largest democracy in the world with a population of

1,027 million people, of which 35 per cent are still illiterate. The paper
describes the role that information and communication technologies are playing
for Indian society to educate them formally or informally which is ultimately
helping India to emerge as an information society.
Design/methodology/approach – The basic approach has been a literature

review to find the historical situation and present the prevailing scenario as well
as the change that are taking place with the application of ICT to the advantage
of the society in different areas including daily life.
Findings – The paper briefly describes the changes that are taking place with
the application of ICT to the advantage of the society in different areas
including daily life. It briefly describes the various initiatives taken in various
states and union territories of India to take advantages of ICT.
Originality/value – The paper provides the clear picture of India and Indian
endeavours to adopt the new technologies to become an information society.
• Strengthening human capital for

knowledge economy needs: an Indian
perspective
Abstract
Purpose – The purpose of this paper is to examine the initiatives being taken in
India in recent years to revitalize the national education and skill development

systems from the perspectives of a knowledge economy. These initiatives
include strengthening of the higher and technical education system of the
country and bringing about a paradigm shift in the national skill development
system through the plans of action contained in the on-going Eleventh Five
Year Plan (2007-2012). The new policy frameworks for education and skill
development developed by respective Government Ministries are also to be
examined from the point of view of their efficacy in moving India up the ladder
of knowledge economy.
Design/methodology/approach – The critical review is based on an assessment

of India's current status on well-known Knowledge Economy Indices, providing
a conceptual understanding of the requirements from the country's education
and skill development systems, and the emerging needs for making measurable
progress on issues related to education and skill development. The approach is
literature-survey based.
Findings – The paper, while underscoring the emphasis given by the

Government in bringing about major changes through mission-mode activities
in both education and skill development systems, highlights possible gaps and
mismatches in various initiatives taken up by different agencies, resulting in
continuing issues and challenges in India's path towards moving up the ladder
of knowledge economy.
Originality/value – The paper gives a fresh look at several initiatives which

have been continually taken up by the Government in the past, from the prism
of a knowledge economy.
• Economic reforms and social justice in

India
Abstract
Purpose – The purpose of this paper is to specify some historical and current
issue regarding this subject. Like, what has been the relative importance
attached to the different aspects of policy; what has been the pace and progress
of reform process.

Design/methodology/approach – The paper begins with a short discussion of
the background of the study and overview of post-independence economic
policy. Hence it is a descriptive study that it finds some data from government
site. This paper is thought to provide more reliable information about above
impacts for policy makers and State and Central Government.
Findings – The paper specifically focuses upon economic reforms and social
justice in India, issues relating to the progress of economic reforms, need of
reforms for human face. More generally, the paper suggests that government
should make relatively limited use of key performance Indicators for economic
reforms and have high-level participation rates benchmarking for social justice
exercises.
Research limitations/implications – Some implications are the timing of the

various policies and, more importantly, their sequencing and the relative
importance attached to the different aspects of policy, in as much as domestic
priorities relating to the provision of education, health and employment,
globalization of the economy.
Practical implications – The paper can help to promote administrative,

managerial, and financial support for economic reforms and social justice in
India and emphasis the responsibility to the state and central to enlarge reforms
opportunities and encourage economic development.
Originality/value – Indian Government decides to accelerate the rate of

economic growth and to speed up industrialization, to develop heavy industries,
to reduce disparities in income and wealth through economic reforms and social
justice.
• Public sector performance

measurement in developing countries: A
literature review and research agenda
Type: Literature review
Abstract
Purpose – This paper aims to explore the influence of specific characteristics of

the public sector in developing countries (i.e. a low-institutional capacity, a

limited involvement of stakeholders, and high levels of corruption and
informality), and of reforms of this sector, on public sector performance
measurement (PSPM).
Design/methodology/approach – Based on a review of prior literature, the

paper develops understanding of the demand for and supply of performance
information in developing countries, and of changes in this area.
Findings – The paper argues that public sector organisations in developing

countries are likely to face an unbalanced position, i.e. disequilibrium between
the demand for and supply of performance information. More precisely, the
public sector reforms – which are partly stimulated by a growing involvement
of some stakeholders – lead to an increasing demand for performance
information but, because of the low-institutional capacity and the high level of
corruption, this increasing demand is not always followed by a sufficient supply
of performance information. This leads to an “unsatisfied demand” position.
Research limitations/implications – The paper concludes with an overview of

issues related to PSPM in a developing country context that require further
investigation.
Practical implications – The arguments presented in this paper are summarised

in an overview of factors that influence the demand for and supply of
performance information in the public sector in developing countries. This
overview might be helpful to those who are involved in the design of
performance measurement systems in these countries.
Originality/value – So far, relatively little is known about PSPM in a

developing country context. This paper is an attempt to fill this gap.
• Communication structure of the public

sector in India: an empirical analysis
Abstract
Purpose – The purpose of this paper is to report empirical research about the
chronological development of the organizational structure, functions (functional
groups) and competencies of the corporate communication(/public relation) –
CC(/PR) department of the central public sector enterprises (CPSEs) in India.

This paper also attempts to identify the specific organizational goals that
influence CC(/PR) departmental structure and its effectiveness.
Design/methodology/approach – In total, 34 selected CPSEs reflecting most of

the salient features of the public sector in India are identified. Key personnel (or
designates) in the CC(/PR) departments are contacted to take an online survey
that is built after analyzing previously reported instruments appropriate in this
context. Analyses are conducted using SPSS 10.0.
Findings – Data analysis shows that in many PSUs, the development of full-
fledged CC departments is still at a nascent stage; however, in other PSUs
development of CC is already streamlined with company vision and is mature as
a division. Key acceptable PR roles include communication for the desired
perception among target audience and brand sustainability. In established CC
departments, CC is a strategic management tool, synchronizing all intentional
forms of internal and external communications, thus helping the PSUs to define
its corporate image and improve corporate performance. Through the built-in
measurement systems, PSUs are encouraged to become global players.
Originality/value – The paper empirically measures the efficiency of CC(/PR)

departments of 34 operating CPSEs concerned with the development of the
engineering industry in India. This paper would be of value to researchers and
practitioners seeking to promote, practice or influence the structuring of
CC(/PR) departments.
Electricity Sector in India: Can Markets

Work?
Alok Kumar
LBSNAA
July 31, 2010
Abstract
The Indian electricity sector is characterized by gross under-investments in the
generation sector. Despite a very low level of per capita consumption vis-à-vis a
country like China, the installed generation capacity is unable to meet the
demand with average peak shortages estimated to be in the range of 15-16%.
Moreover transmission capacity bottlenecks pose an obstacle for bulk transfer

of power from surplus to deficient locations. Further, only 56% of the
households have access to electricity. The distribution sector is plagued by
serious under-recoveries with transmission & distribution loss levels that are
amongst the highest in the world.
Reforms in this sector are therefore imperative. Strong arguments have been
made in favour of setting up competitive markets for trading electrical power in
order to enhance efficiencies in the sector. However, given the fact that the
reform objectives of the sector in India are different from that of the countries in
the developed world; the standard template of reform may not work and
therefore there is need to exercise caution before committing to the reform
path.
FINDINGS :-This paper analyzes the electricity sector in India in respect of the
potential concerns that could arise in implementing wholesale spot markets for
trading electric power; it draws upon the lessons learnt from implementation of
similar reforms in over 70 countries in the world. An analysis of the initial
starting conditions and institutional endowments of these countries are
undertaken with a view to identifying how they contributed to success or
otherwise of the electricity reforms and in the process drawing lessons for the
conditions prevalent in the Indian context.
FDI in Indian Retail Industry

Syeedun Nisa
April 1, 2007
Abstract
India is one of the largest emerging markets, with a population of over one
billion.India is one of the largest economies in the world in terms of purchasing
power and has a strong middle class base of 300 million.
Around 70 per cent of the total households in India (188 million) reside in the
rural areas, where mostly traditional retail outlets, commonly called kirana
stores exist. These are unorganized, operated by single person and runs on the
basis of consumer familiarity with the owner. However, recently organized
retailing has become more popular in big cities in India and most of the
metropolitan cities and other big cities are flooded by modern organized retail
stores. Many semi-urban areas also witnesses entry of such organized retail

outlets. Till now, entry of foreign retailers was restricted in Indian retail market
because of the ban on Foreign Direct Investment in Indian Retail Sector . But
recently, as government has changed its policy and the cabinet has allowed 51
per cent FDI in single-brand retail, the prospects of foreign players entering
India became high.
• Public sector performance

measurement in developing countries: A
literature review and research agenda
Type: Literature review
Abstract
Purpose – This paper aims to explore the influence of specific characteristics of

the public sector in developing countries (i.e. a low-institutional capacity, a
limited involvement of stakeholders, and high levels of corruption and
informality), and of reforms of this sector, on public sector performance
measurement (PSPM).
Design/methodology/approach – Based on a review of prior literature, the

paper develops understanding of the demand for and supply of performance
information in developing countries, and of changes in this area.
Findings – The paper argues that public sector organisations in developing

countries are likely to face an unbalanced position, i.e. disequilibrium between
the demand for and supply of performance information. More precisely, the
public sector reforms – which are partly stimulated by a growing involvement
of some stakeholders – lead to an increasing demand for performance
information but, because of the low-institutional capacity and the high level of
corruption, this increasing demand is not always followed by a sufficient supply
of performance information. This leads to an “unsatisfied demand” position.
Research limitations/implications – The paper concludes with an overview of

issues related to PSPM in a developing country context that require further
investigation.

Practical implications – The arguments presented in this paper are summarised
in an overview of factors that influence the demand for and supply of
performance information in the public sector in developing countries. This
overview might be helpful to those who are involved in the design of
performance measurement systems in these countries.
Originality/value – So far, relatively little is known about PSPM in a

developing country context. This paper is an attempt to fill this gap.
• Structuring organizations across

industries in India
Abstract
Purpose – The purpose of this paper is to investigate structural patterns across

industries in India. Organizational design is posited as a form of competitive
advantage, which also helps Indian organizations build excellence.
Design/methodology/approach – The study used a questionnaire to investigate

the structural patterns of organization in 32 enterprises in India. The sample
consisted of 1,532 participants across six industries. The data were analyzed
usingSPSS v.15.0.
Findings – The findings suggest that the outward picture of structural patterns
remains the same across industries but significant difference emerge in the inner
core of the structural architecture of Indian organizations. For example, the
inner core of the banking industry was found to be different from the other five
industries studied.
Practical implications – The findings suggest that the links between

organizational structure and national culture should be harmonious.
Simultaneously, the structure of the organizations should be aligned with both
the task and general environment of the business.

Originality/value – There is a scarcity of research into this domain of
knowledge in India and the paper provides additional insights into the
organizational structures of Indian enterprises across the major industrial
sectors.
SUMMARY AND CONCLUSION
It is quite opposite to the confident expectations in 1991-92 , the Private Sector

has hardly contributed thus far to maintaining the Power demand-supply gap.
Only a few private sectors have actually commenced generation , perhaps due to
the problems experienced. However , if all the projects under consideration do
come on stream ,the share of Private players will increase substantially.
There should be greater transparency in decision-making , greater Public

Participation(particularly from civil society) and greater spread of information.
Public Sector undertakings have continued to remain the main players in the
field ,particularly as they have been constructing generating plants on ,and even
ahead of schedule.
In some regions of the country ,with the completion of Projects under

construction ,there has come to be an excess of electricity availability over that
required by customers at tariff payable. This surplus may not have occurred if
electricity connections were extended to all homes ,and if rural areas were
supplied throughout the day. However ,with these consumers unlikely to be
paying the tarrifs for electricity,commissioning of new Private Power Plants
could lead to a surplus.

Implementation of many of the recommendations is already under way,
drawing on five key lessons from recent experience :
• Continue to Support PSDE (Private sector development in the

electric power sector) :- Experience has shown that the private sector has
brought efficiency gains, performance improvements, and cost reductions when
the incentives for investors, producers, consumers, and regulators were
adequately addressed. Pursuit of greater engagement of the private sector in
distribution, in particular, is important.
• Need for Government Support of Broad-Based Reforms :- Reforms are key

to increasing economic efficiency and will be supported by economic and sector
work, policy advice,and adjustment operations. Monitoring and evaluation will
be done in parallel to establish the empirical evidence to guide the World Bank
Group’s evolving agenda. Anambitious PSDE agenda should only be supported
when there is clear and strong political commitment, including up-front actions
to strengthen sector governance.
• Innovation :- The WBG(World Bank Group) will continue to support

innovative approaches, especially in addressing the Millennium Development
Goals and objectives that build on them .
Competition as an Incentive Mechanism for Efficiency Gain :-. To establish

incentives for the desired efficiency gains, the WBG will continue wherever
feasible to support the establishment of an enabling environment for a
competitive generation market.
Governance :- It is important to strengthen governance structures (including

regulation, protection of investor rights, and implementation of internationally
recognized accounting and auditing principles) before privatization.
Privatization can help develop better governance arrangements by formalizing a
separation of powers and arm’s length regulation.

REFERENCES
1. Author(s): A.K. Sharma, Ekta Vohra

Source: Engineering, Construction and Architectural
Management Volume: 16 Issue: 1 2009
2. Author(s): Rasmi Ranjan Das

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3. Author(s): Deepak Chawla, Himanshu Joshi

Source: Journal of Knowledge Management Volume: 14 Issue: 6 2010
4. Author(s): Amit Mitra

Source: Journal of Management Development Volume: 28 Issue: 6 2009
5. Author(s): Anjula Gurtoo

Source: International Journal of Public Sector Management Volume:
22 Issue: 6 2009

6. Author(s): Maitrayee Ghosh, Ipsheet Ghosh
Source: Program: electronic library and information systems Volume:
43 Issue: 2 2009
7. Author(s): Shashi Prabha Singh

Source: Electronic Library, The Volume: 23 Issue: 6 2005
8. Author(s): Surinder Batra

Source: Journal of Knowledge Management Volume: 13 Issue: 5 2009
9. Author(s): Kalpana C. Satija

Source: International Journal of Social Economics Volume: 36 Issue:
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Source: Journal of Accounting & Organizational Change Volume:
3 Issue: 3 2007
11. Author(s): Saroj Koul

Source: Corporate Communications: An International Journal Volume:
14 Issue: 3 2009
Source: Kumar, Alok, Electricity Sector in India: Can Markets Work? (July
31, 2010). Available at SSRN: http://ssrn.com/abstract=1651378
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at SSRN: http://ssrn.com/abstract=983711
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3 Issue: 3 2007
15. Author(s): Sanjay Kumar Singh

Source: Management Research News Volume: 32 Issue: 10 2009

Main sources: http://papers.ssrn.com/sol3/results.
http://Emerald insight.com

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SUBJECT:BUSINESS

MR.LOKESH JAS RAI

PRIVATE SECTOR PARTICIPATION IN POWER SECTOR IN INDIA Page 1

REASONS FOR INVITING PRIVATE SECTOR

CHALLENGES AND RISKS

SUMMARY AND CONCLUSION

PRIVATE SECTOR PARTICIPATION IN POWER SECTOR IN INDIA Page 2

I wish to express my deepest gratitude and warmest appreciation to

me to the overall success of the undertaking study:-

To My Friends, who have been unselfishly extending their efforts

and understanding. To My Parents who have always been very

understanding and supportive both financially and emotionally.

I would also thank My Institution and my faculty members without

whom this project would have been a distant reality.

and for the continued guidance and protection.

PRIVATE SECTOR PARTICIPATION IN POWER SECTOR IN INDIA Page 3

Major Players and Presence in value chain:-

Domestic Private Sector

International Private Sector

• China Light and Power (CLP)

The electricity sector in India is predominantly controlled by Government of

PRIVATE SECTOR PARTICIPATION IN POWER SECTOR IN INDIA Page 4

PRIVATE SECTOR PARTICIPATION IN POWER SECTOR IN INDIA Page 5

• Encouraging the private sector to set up coal, gas or liquid-based

• Constitution of Independent State Electricity Regulatory Commissions

• Deregulation of the ancillary sectors such as coal.

• Introduction of the Electricity Act 2003 and the notification of the

• Provision of income tax holiday for a block of 10 years in the first 15

• Un-bundling of the State Electricity Boards (SEBs) into generation,

PRIVATE SECTOR PARTICIPATION IN POWER SECTOR IN INDIA Page 6

Further, in the case of private promoters, projects without foreign participation

PRIVATE SECTOR PARTICIPATION IN POWER SECTOR IN INDIA Page 7

AS the Indian power sector is embarking on increasing the generation and

The problems are as follows:-

 Renegotiations leading to delays

 Project Execution-Needs to be active

 Land Acquisition and Environment Clearance

 Schedule Dependency on Transmission Lines

 Technical losses and Improvement of the T&D system

 Privatisation of the T&D system

PRIVATE SECTOR PARTICIPATION IN POWER SECTOR IN INDIA Page 8

 Exchange Fluctuation Risk

• Critical evaluation of road infrastructure

Design/methodology/approach – The targets for the road sector development

PRIVATE SECTOR PARTICIPATION IN POWER SECTOR IN INDIA Page 9

Originality/value – The paper significantly contributes in assessing the state of

Introducing competition in the power sector in India:

Purpose – The twin objectives of power sector reforms in India – improving

Design/methodology/approach – The study is a historical analysis of

Findings – The introduction of competition in the USA has brought substantial

Originality/value – This paper offers some practical and implementable

PRIVATE SECTOR PARTICIPATION IN POWER SECTOR IN INDIA Page 10

Purpose – There is no single way of achieving business success. The concept of

Design/methodology/approach – The paper uses a sample comprising 16

Research limitations/implications – The study uses a sample of four public

Originality/value – The paper tries to bring forth concern areas for KM in

PRIVATE SECTOR PARTICIPATION IN POWER SECTOR IN INDIA Page 11

Purpose – Examination of the challenges of dependence on the private sector of

Design/methodology/approach – A literature review, consideration of flagship

Research limitations/implications – This research was desk-based and reliant

Practical implications – Government agencies ought to be able to think more

Originality/value – The theme itself is new in a context where new ways of