An Analysis of Rural Household Electrification: The Case of Bihar

Abstract

Rural electrification has been an important part of government policy since India gained independence. Because around 70% of India’s total population live in the country’s rural areas, electrical supplies to these areas are crucial in terms of both economic and social benefits.¹ Regarding economic benefits, electricity can be used for irrigation pumps, processing agricultural output, storing perishable agricultural goods, and so on.² Since agriculture is predominant in the rural economy, electricity can play a crucial role in reducing poverty and promoting rural development. The social benefits that electricity brings are manifold and critically important to human well-being. It allows children to study and women to cook at night. It produces cleaner indoor air than biomass fuels, thus contributing to human health (Barnes et al., 1997; UNDP/WHO, 2009). Furthermore, it gives rural populations opportunities to gain access to telecommunication and mass media (Andreas, 2006). It is also noted that electricity usage has a positive impact on rural women’s lives as they can have more free time for other activities by using electricity in their daily routines such as cooking and pumping water (UNDP/World Bank, 2004; World Bank, 2012). A recent World Bank report says, ‘electricity not only alleviates poverty in the near term but also holds the potential to do so over the longer run’ (World Bank, 2012).