Reliance Infrastructure, led by Anil Ambani will soon enter in a joint venture with Chinese firm Shanghai Electric Corporation to build an Rs 12,000-crore power equipment plant.

The JV is expected to be completed by 2010 and will have an initial capacity of 10,000mw. The project undertaken by the two companies is expected to be bigger than state-run Bharat Heavy Engineering (Bhel) in terms of capacity.

For the proposed plant, this 50:50 JV will raise around Rs 9,500 crore as debt. The majority of fund will be provided by the foreign banks.

The major reason to set up this JV is the ever increasing demands in the domestic and neighboring markets. Other than this JV, Reliance Infra is also planning to enter in another four joint ventures with Shanghai Corp, which will enable India to have a range of third-party services for power utilities.

Along with the after- sales services and erection of power equipment, the project will also offer services in the fields of technical and design support, operations and maintenance. All this will require a combined investment of $400-600 million and would generate up to 400 jobs.
 
The Chairmen of the both the companies-Anil Ambani for Reliance Infra and XU Jianguo for Shanghai Corp- will be signing a framework of agreement for long- term strategic corporation on Monday.