Perils of partial deregulation

It is not easy for companies to grow in a partially deregulated sector. Jostling in the space often leads to firms innovating “custom” deals with government-owned entities. One early example of such “innovation” in the Indian economy, however, went horribly wrong. The Dabhol power generation project promoted by the beleaguered Enron Corp. proved to be a case of serious governance failure. Consumers were deceived into buying expensive electricity.

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