New Delhi, Dec. 17: Bharat Heavy Electricals Limited (Bhel) and the National Thermal Power Corporation (NTPC) have joined hands to make equipment and bid for power projects.
The duo have signed an agreement to set up a 50:50 joint venture and expect the synergies from their association will help them to place competitive bids for mega power projects.
During the bid for the Sassan mega power project in Madhya Pradesh, the NTPC lost out to Reliance Power because of high equipment costs for which Bhel was the supplier.
To further boost its chances of winning mega projects, the NTPC is looking for coal blocks overseas.
The synergy will be mutually beneficial to both organisations as they have a vast resource pool and expertise in their respective areas, officials said. The joint venture would bid for new power projects, they added.
As part of an arrangement, the post of the chairman and managing director of the joint venture will be rotated among the two companies.
The NTPC has capacity to produce 27,900 mega watt (MW), which is 20 per cent of the countrys installed capacity.
It contributes to 29 per cent of electricity produced in the country and plans to produce more than 75,000 MW in another 10 years.
A report by a parliamentary standing committee had asked the government to promote more Indian equipment manufacturing companies because Bhel had its hands full with orders.
The report also suggested joint ventures with foreign manufacturers to bring in advanced technology.
The power ministry is also in favour of more equipment companies, even suggesting the entry of the NTPC.