Reliance Power to buy equipment worth $2.2 billion from GE
08 Nov 2010
Anil Ambani-led Reliance Power Ltd will purchase equipment worth $2.2 billion (about Rs10,000 crore) from General Electric Co of the US, under a deal backed by a $5-billion line of credit from the Export-Import Bank of the US.
The financing deal for the power project, signed during US president Barack Obama's ongoing visit to the country, is expected to create 5,000 jobs in South Carolina, New York and Milwaukee, a company release said.
Reliance Power Ltd said the 2400-megawatt power plant being set up in Samalkot, in South India, would be operational by 2012.
US Exim would make $5 billion available to Reliance Power for the purchase of US goods and services over the next three years for its various projects.
Reliance Power, which last month signed a $10 billion deal with Shanghai Electric Group Co for purchase of power generation equipment for 30,000 megawatt projects (See: Reliance Power, Shanghai Electric ink record deal for equipment) , had also signed a $12 billion financing deal with four Chinese banks, including the Export-Import Bank of China, Bank of China Ltd., China Development Bank and Industrial and Commercial Bank of China Ltd.
Anil Ambani, chairman of Reliance Power, and Fred Hochberg, Chairman and President of US Exim, signed the financing deal.
Despite Indis's avowed policy of preference to domestic power equipment suppliers, the country is importing around 25 per cent of its requirements from low-cost Chinese suppliers.
Faced with severe domestic supply shortfalls, Indian power generation companies have increasingly been looking to overseas suppliers to meet the 60 per cent capacity addition target for the Eleventh five-year plan ending March 2012.
