Blog
Unit 4 Macro: India’s Energy Deficit Limits Growth
7th August 2012
India faces chronic shortages of energy and her creaking infrastructure was demonstrated clearly in the summer of 2012 with a dramatic electricity blackout that left 620million people without electricity. Trains, hospitals, businesses were all affected, India’s wealthy have always relied on back-up generators, many millions of others cannot afford such luxuries and were left sweltering in the heat without any air conditioning.
Fast-growing economies must meet the challenge of providing sufficient energy for households and businesses and the blackout has amplified concerns about whether India can continue to grow and develop without massive new investment in her energy industry. The Times of India commented that ““Lack of power holds back India’s industrial take-off, and prevents it from making the kind of strides in reducing poverty that China or East Asia have.”
Background:
- In 2011, 289 million people – 25% of India’s population – had no access to electricity
- In rural areas that figure rises to 33%, according to a report from the Indian government in 2011
- Estimates from the International Energy Agency suggest that even in 2030, not all Indian homes will have electricity, according to AEA calculations.
Reading:
Ten interesting things about India power (BBC)
India: 600 million without power in ‘biggest ever blackout’ (Telegraph)
Geoff Riley
Geoff Riley FRSA has been teaching Economics for over thirty years. He has over twenty years experience as Head of Economics at leading schools. He writes extensively and is a contributor and presenter on CPD conferences in the UK and overseas.