Embeddedness of Economic Reforms in Regional Political Climate: A Case of Delayed Reforms in Bihar’s Electricity Sector

Often national-level policies are studied without giving due attention to the regional political context. However, it is widely recognized that significant differences do arise in the way policies get implemented in different regions. This chapter underscores the importance of the regional political context in explaining the much-delayed reforms that took place in the electricity sector of Bihar. The performance of the electricity sector is essentially embedded in three major epochs in the political history of Bihar in which a fifteen-year period of a particular political party figures centrally. The state was delayed in reforming the sector due to their approach of ‘state incapacity by design’ which was deeply rooted in a larger sociopolitical institution called caste that is dominant in Bihar. Eventually, Bihar succeeded in reforming its power sector in the post-2012 period with the change in the political regime where power sector reform was given high priority. Enhancement in networks and customer base, organizational restructuring and mobilization of financial resources were possible because of sufficient political support towards this basic developmental challenge.