Tata Power and the PowerGrid Corporation of India are in talks for setting up a joint venture which will construct a 1,000 km transmission line between New Delhi and the Bhutan border.
Tata Power will hold 74 per cent stake in the joint venture with PowerGrid holding the balance 26 per cent. The move was confirmed by both sides.
Adi J Engineer, managing director, Tata Power said, "We are at present in discussions with PowerGrid. No final decision has been made."
A senior PowerGrid official in New Delhi said, "We are talking to Tata Power for the joint venture. Our earlier talks with National Grid fell through." He declined to give further details.
Although figures were not immediately available, industry experts said that it would cost at least Rs 1,700 crore to set up the transmission line.
PowerGrid is India's nodal transmission agency owning huge transmission networks across the country. It has recently floated a tender for setting up six transmission projects entailing an investment of $ 2.6 billion.
Tata Power would benefit from the move as it would gain from PowerGrid's experience in setting up transmission lines. For PowerGrid, it would mean that it would have surplus funds to focus on laying an optic fibre backbone.
Tata Power is planning a greater thrust on the power transmission business which has been recently been thrown open for private participation.
As part of its new thrust on the business, Tata Power acquired the transmission business of closely-held group company Tata International for Rs 13 crore. Tata International's division also had presence in a few countries outside of India.
