Power sector reforms: resolute stand essential

02 Jan 2000

As this issue goes to press, the power sector in northern India is facing a serious labour problem, with the employees of the UPSEB (Uttar Pradesh State Electricity Board) having gone on strike and the danger of other states showing their sympathy by adopting ?work to rule? tactics. The stand taken by the UPSEB employees and unions deserves no public support, because the government of UP has rightly decided to corporatize the electricity industry in the state, with full assurance that all the rights and privileges of the employees will be protected in the new set-up. This is an organizational change which is fully within the rights of the authorities to implement. It is evident, however, that the SEB employees, perhaps, see this step as the thin end of the wedge and presumably the first step towards privatization of the power sector. But even if this were so, it is unlikely that public support for their actions would be forthcoming. Given the sick condition of the power industry in most states of India, the public is quite supportive of progressive steps that would bring about a major change in the structure and functioning of the industry. Hence, the striking workers of the UPSEB are clearly swimming against the tide, and sooner or later in the democratic set-up that we have in India, they would be under great pressure to relent. What is important, however, is for the government to take a resolute stand, and not baulk under the threat of dislocation and disruption that, perhaps, would reach a serious level if several states join the UPSEB in overt or covert actions. If there is a lack of strength in the government response, it would be impossible to bring about reform in the country?s power sector. This, in turn, would be detrimental to economic progress and the realization of expectations that exist for an era of rapid economic growth in the coming years. Corporatization is one means by which the power supply industry can get some degree of financial autonomy, but if at the next stage private sector involvement becomes necessary and feasible, this cannot be to the detriment of the workers of the UPSEB. They need only to look at the welfare of employees of the Tata Electric Company, BSES, and other private sector power entities in India. One hopes that a larger wisdom will dawn on the striking employees and that they accept the realization that opposing reforms at this stage would receive no public support.
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