The electrical power distribution system is said to be well designed if it delivers good quality of power to each and every consumer especially remote end consumer in the system.  The quality of power is always referred with respect to voltage profile.  Voltage at various locations in the system is mainly depends on the reactive power flow in the system.  The voltage can be maintained closed to rated voltage by connecting shunt capacitor banks in the system.   Voltage profile of the system can also be improved by the concept of reconfiguration of the system in which topological structure of the system is changed by opening/closing the sectionalizing/tie switches.  Inclusion of shunt capacitors along with the optimal network reconfiguration also reduces the losses in addition to the voltage profile improvement.  Inclusion of shunt capacitors with distribution system provides the reactive power support for inductive loads and reconfiguration alters the power flow patterns such that voltage profile of the system improves and reduces the power losses. In this work an algorithm based on modified particle swarm optimization is proposed to find the optimal sizes of the capacitors and modified discrete particle swarm optimization is used for optimal network reconfiguration.  The optimal locations of the capacitors are obtained by conducting the sensitivity analysis.  The proposed algorithm is tested on IEEE-33 bus radial distribution systems and results are presented.