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Answer Posted / pk
It depends on the length from source to load, maximum permissible loss and thermal capacity of insulation.
Resistance = Rho x Length / Cross Sectional Area
Voltage Drop = Current in the wire x Resistance
The resistance of the wire leads to voltage drop
Depending on how much voltage drop is permissible at the load the area should be chosen appropriately
The second factor is heat produced.
Energy Loss = heat produced = I^2 x R.
This will lead to a temperature increase. The insulation should be able to handle this rise. Also the losses should be as low as possible to improve efficiency.
This is the theory. Thumb rules of 3-5 Amperes per sqmm are prevalent in the industry
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