ELECTRICITY SUPPLY: EVOLUTION AND REFORM 117


pointing to the loan that the Naidu government had accepted to support the power-sector reforms. As Srinivasulu (2004, 24) notes, the World Bank also became a shorthand expression for various reforms of the Naidu government that the Left criticized in their campaign.


The TDP was soundly defeated in the 2004 elections. The number of TDP members in the assembly dropped from 180 to 47, while those of the Congress Party increased from 91 to 186 (Srinivasulu 2004). It would require an analysis of election-survey data to assess the importance of the power-sector reforms and the election promise of free electricity in contributing to this outcome.5 After the TDP’s nine years in power, anti-incumbency sentiment certainly played a role as well.


2004–06: Combining Free Electricity with Power-Sector Reforms Immediately after taking the oath of office, the newly elected Chief Minister Rajasekhara Reddy fulfilled his election promise and declared free electric- ity for all farmers. He also waived the electricity dues of the farmers and approved other relief measures. In November 2004, he declared that the government would continue free power supply to agriculture pump sets “till the farming by farmers becomes viable” (Hindu 2004).


Rajasekhara Reddy’s government did, however, introduce some targeting of the electricity subsidy in 2005 by excluding approximately 5 percent of the farmers from the free power supply, based on criteria such as large hold- ings, having more than one pump set, and having nonfarm income. The gov- ernment also promoted measures to save energy by making compulsory the use of capacitors (energy-saving devices) for pump-set owners. Rajasekhara Reddy announced that farmers who failed to install capacitors by March 2006 (a deadline that was later extended) would be deemed ineligible for the free-power scheme (Hindu 2005a). As a measure to save both water and electricity, the Rajasekhara Reddy government announced in 2005 that farm- ers would not be eligible for the free-power scheme if they grew paddy in the rabi (winter) season. In the face of stiff protest by opposition parties and farmers’ organizations, however, this plan was not implemented (Kurmanath 2005). The government also reduced the hours of power supply to control the level of subsidies it had to pay out. Predictably, the TDP criticized this move (Hindu 2006a). These restrictions and targeting measures received com- paratively little publicity, suggesting that they may have been “stealthy” elements in the reform process (see Jenkins 1999).


5 Unlike data for Punjab (see “Emergence and Establishment of Fertilizer Subsidies, Late 1977 to 1991” in Chapter 5), the available election-survey data for Andhra Pradesh do not include infor- mation on voters’ opinions regarding free electricity.


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