An Enquiry Into Efficacy of Privatization Process in Power Sector – A comparative Study of India and Argentina

Privatization and restructuring of government-owned power companies has been a feature of almost every country's government policy over the last ten years aimed at bringing greater efficiency in the industry. Governments have reviewed policies to allow private players in the industry. However the process of privatization is engulfed with complex problems with each country having peculiar solution. These problems range from country to country as specific privatization models attract separate type of problems. All countries have tailored their methods of privatization reforms according to the circumstances of their countries. Thus, the impact of privatization on the electricity sector may produce different results, depending on the design and its implementation. The research paper documents in a preliminary manner the motivations that induced governments to rely on privatization as an economic instrument for bringing efficiency and reliability in the power sector and also provide for quantitative analysis of efficiency performance after privatization. Using an original panel dataset for period 1991–2008, it also tries to gauge the success of the design and implementation of economic policies by carrying out a comparative study between India and Argentina. The study is about describing the state of affairs in the electricity sector as it exists at present and has no control over variables; therefore Ex-Post facto research has been undertaken. A cross national policy sector approach has been used and the database for the present research is secondary.