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Reshaping India's power sector

India's electricity sector is undoubtedly complex and vexed to deal with. On the one hand, it is plagued by shortages aggravated by consistent under-achievement of capacity addition targets, while on the other, an attempt is being made to bring competitive efficiencies while 'protecting' consumer interests. Several developments in the past couple of weeks highlight the emerging challenges in governing this sector.

To start with, is the ambitious target that India has set itself to put in place 20,000 mw of solar capacity by the year 2020. At this juncture, it is a moot point whether the policy/regulatory environment that would be created to achieve this target would unshackle the sector to such an extent as to make this target seem modest. The important issue is the blurring of lines between the ministries of power and the ministry of new and renewable energy (MNRE).

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