RP-Sanjiv Goenka Group’s flagship company CESC Ltd has signed a long-time strategic co-operation agreement with Shanghai Electric Group.
On the basis of the agreement, the firms are likely to explore setting up ultra mega projects jointly, coal-based projects and wind projects in future. “It may be through a joint venture in future,” said Sanjiv Goenka, chairman of RP-Sanjiv Goenka Group and vice chairman of CESC. Meanwhile, Haldia Energy, a wholly-owned subsidiary of CESC, has signed a contract for supplying boilers, turbines and generators (BTG) for the 600 mega watt (MW) Haldia thermal power project at an estimated cost of Rs 1,000 crore.
This is for the first time that the Chinese power equipment major is entering into a strategic tie up with an Indian company. According to Goenka, it is a “broad-spectrum co-operation agreement”, through which both the companies would explore further avenues in the Indian market.
The firm, which entered the Indian market 14 years ago, currently has 14 contracts of about 22,000 MW. “This tie-up is a win-win situation for both the parties. We will be able to supply equipments cheaper than local manufacturers and will be able to give a better service, as we have expertise in wind, solar, gas and hydraulic power projects,” said Zhu Denian, vice president, Shanghai Electric Power Generation Group.The Chinese firm has already applied to the Indian government to set up a subsidiary here. “In the second stage, we will look for partners to set up joint venture for power projects in the country. It is a step-by-step growth plan for us,” Denian said.
Goenka said, the work on the Haldia project had already started with Rs 3200 crore in the first phase, of 600 MW (2x300). It is expected to be ready by the middle of 2014. Shanghai electric is also supplying BTG for Chandrapur power project in Maharashtra, where Dhariwal Infrastructure (another CESC subsidiary) is setting up a 2x300 MW coal-fired thermal power project.