The linear theory of electromagnetic radiation from a localized plasma-loaded backward wave oscillator with sinusoidally corrugated slow wave structure driven by an annular intense relativistic electron beam has been derived and analyzed numerically. The enhanced radiation from a plasma-loaded structure is attributed to the increase in the spatial growth rate of the absolute instability. The backward wave oscillator instability without plasma is found to be most effective in a case where the beam travels near the wall of the slow wave structure. For the given number of plasma particles per unit length of the structure, the decrease in the plasma column radius enhances the output radiation.