Cross-Sector Subsidies in Electricity Pricing in Maharashtra, India

ISBN-13: 9783659471438 / Angielski / Miękka / 2013 / 64 str.

Radhika Joshi

Opis

Subsidies in electricity tariffs in India are currently designed in a way such that industrial and commercial sectors pay higher rates to finance subsidies given to the residential and agricultural sectors. These cross sector subsidies have led to wastage, contributing to severe shortages in the electricity sector. This study provides a critique for the existing pricing policy and suggests suitable alternatives to ensure efficient allocation as well as equitable distribution of the countrys energy resources. Results obtained from sector-wise estimation of elasticity of demand for electricity suggest that subsidies should be implemented within a sector rather than across sectors. The findings of this study have several relevant implications which bear in mind the economic as well as political considerations that are required while framing policies for pricing of key commodities such as electricity.

O autorze

Radhika Joshi is an Economist and is passionate about applying economic theories for framing public policy. She holds a masters in Economics from Tufts University and is presently pursuing her PhD at the Indian Institute of Management, Bangalore. She has worked for LKY School of Public Policy, Singapore and Maharashtra Economic Development Council.