Electricity provision and industrial development: Evidence from India

►I study the effect of electrification on industrialization in India for 1965-84. ►In that period electric pumpsets were used to obtain water from the ground. ►I use irrigation groundwater as an instrument for electrification in rural areas. ► There is evidence that the IV is strong and the exclusion restriction is plausible. ►Electrification explains 14% of variation in manufacturing across Indian states.