Ratul Puri: The Future Of Economic Growth Runs On Electricity
Electricity is emerging as a key driver of economic growth, shaping manufacturing, AI infrastructure and industrial investment. Ratul Puri believes India must build affordable, reliable power capacity ahead of demand, modernise grids, expand storage-backed renewables and strengthen infrastructure to gain a long-term competitive edge in the global economy.
For decades, electricity was viewed as a support system for economic growth. Industries expanded, cities developed, consumption increased and power infrastructure quietly grew alongside them. That equation is now changing rapidly. Electricity is no longer operating in the background of economic activity. It is becoming one of the primary drivers of growth itself.
According to Ratul Puri, electricity is becoming a strategic asset that will shape future economic growth.
Electricity Is Becoming the Foundation of Economic Competitiveness
We are entering an era where the availability of affordable and uninterrupted power will increasingly influence where industries invest, where manufacturing capacities are built and where digital infrastructure develops. In many ways, electricity is set to become one of the defining factors of economic competitiveness.
Ratul Puri believes that affordable and reliable power will increasingly influence global investment decisions.
This transition is already visible across sectors. Transportation is moving steadily towards electrification. What was once considered commercially unviable for heavy mobility applications is now beginning to change because of improvements in battery density and operating economics. In several use cases, the lifecycle cost of operating electric heavy vehicles is becoming more competitive than conventional diesel-based systems. Once economics begins to shift decisively, adoption tends to accelerate far quicker than expected.
A similar transformation is unfolding in the AI-led digital infrastructure. Until recently, a large share of energy consumption in artificial intelligence came from model training. The next phase will increasingly be driven by inference and compute moving closer to users and businesses. This requires large-scale data centre infrastructure and far greater availability of dependable electricity. As India's digital economy expands, electricity demand will rise not only in scale but also in complexity.
Ratul Puri notes that the growth of AI and data centres will significantly increase electricity demand in the coming years.
This is why India must start thinking differently about power infrastructure. For many years, capacity planning has largely remained linked to existing demand projections. In my view, the country now needs to build ahead of demand rather than alongside it. India's per capita electricity consumption stands at 1,400 units per year (2025-26), compared to 3,000 units per year in Vietnam (2025) and 6,500 units per year in China (2025-26), a gap that highlights both the challenge and the enormous opportunity ahead.
Ratul Puri sees this gap as both a challenge and an opportunity for India's long-term development.
Building a Future-Ready Electricity Ecosystem
At the same time, the focus cannot remain limited to adding generation capacity alone. The larger objective should be delivering the lowest possible cost of reliable power to consumers. That requires equal attention on transmission infrastructure, storage systems and grid modernisation.
The electricity ecosystem itself is also going to change significantly over the next two decades. For more than a century, grids were designed around centralised generation and one-way power flow. The future grid will look very different. Generation will increasingly move closer to where electricity is consumed. Storage systems will become more distributed. Consumers themselves will gradually become active participants in the electricity ecosystem.
India is particularly well positioned for this shift because renewable energy potential exists across the country. However, generation today remains concentrated in select regions, which requires power to travel long distances before reaching consumption centres. Often, discussions focus only on generation cost while overlooking the actual delivered cost of electricity after transmission expansion, balancing requirements and downstream infrastructure investments are added.
In the long run, localised generation and localised consumption can fundamentally improve grid efficiency. A model where districts generate and consume a larger share of their own power can reduce transmission pressure, lower infrastructure costs and create a more resilient electricity network. Over time, this will also support peer-to-peer electricity exchange and smarter distributed systems.
Storage-backed renewable energy will play an important role in this transition. Renewable expansion cannot rely only on daytime generation capacity. The next stage of growth will depend on the ability to provide reliable renewable power even during non-solar hours. This is where battery and storage technologies become increasingly important.
According to Ratul Puri, energy storage will be essential for ensuring round-the-clock renewable power supply.
At the same time, India must remain practical about its energy requirements. A growing economy of India's scale will continue to require thermal, hydro, solar, nuclear and renewable sources together for the foreseeable future. The priority should remain clear ensuring affordable and reliable electricity availability at scale.
The progress made in India's electricity sector over the last few years has been substantial. There has been meaningful improvement in generation capacity, renewable energy deployment, transmission infrastructure and overall sectoral confidence. A great deal of de-risking has also taken place, which is encouraging long-term investment into the sector.
However, as the sector evolves, new challenges will continue emerging. Distribution remains a key area of concern today. Tomorrow, there will be different challenges that require equal attention. This makes long-term policy consistency and institutional execution extremely important.
Ratul Puri emphasises that stable policies and efficient execution are critical for attracting long-term infrastructure investment.
There are also certain structural issues that deserve greater focus as infrastructure investment accelerates. Strong and equitable PPP contracts remain critical for long-gestation infrastructure sectors like power. Risk and reward must be distributed fairly across stakeholders. Efficient dispute resolution mechanisms are equally important because infrastructure projects cannot operate under legal uncertainty for decades. Alongside this, faster resolution of land-related issues and digitisation of land records will remain important enablers for future infrastructure expansion.
India has a unique opportunity ahead. The countries that succeed in building reliable, affordable and future-ready electricity ecosystems will emerge stronger in manufacturing, technology and industrial growth over the coming decades. In many ways, the next phase of economic leadership will belong to those who can deliver power at scale, efficiently and consistently.
Ratul Puri is the Chairman of Hindustan Power, an integrated power generation company with a strong presence in renewable and transitional energy. Over the years, Ratul Puri has been involved in the development of large-scale energy infrastructure projects that support India’s growing power requirements and its transition toward cleaner energy sources.
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