Mumbai: Matsushita Panasonic Battery Co of Japan (Panasonic) plans to set up a joint venture with Base Corporation in India to produce a range of automotive batteries with an investment of Rs 100 crore.

The venture will also look at marketing other Panasonic-branded products in India, including mobile handset and camera batteries.

The investment will go towards setting up a manufacturing base in Hosur near Bangalore. While the equity distribution has not yet been finalised, sources say it will be a 50:50 venture. Matsushita Panasonic managing director Mitsuru Kurokawa says the modalities are still being worked out and the unit will be operational next year. The proposed facility will have a production capacity of 1.2 million units a year.

Says Kurokawa: "We will look at making an entire range of automotive batteries at this venture. Besides catering to the Indian market, the unit will also be the export hub to other regional markets like Nepal and Bangladesh."

Later, the firm will introduce batteries for mobile handsets and cameras. Panasonic batteries are currently imported from Matsushita''s overseas ventures and sold in the replacement market.

Base Corporation managing director Girish Arora says the joint venture will be formed very soon, after which the company will apply to the Foreign Investment Promotion Board for Japanese investment.

The factory is scheduled to begin production by early next year, says Arora. "The moment the Bangalore facility is ready, we will tap the burgeoning demand by major carmakers like Maruti and other original equipment-makers. This we cannot do now due to a high import duty."

Matsushita at present sells imported batteries through Base Corporation, and they attract a whopping 51-per cent import duty. After the joint venture is set up the company hopes to get business from the rapidly growing Indian automobile market as an original equipment maker.

The company will also import automotive batteries from its manufacturing base in Sri Lanka. This will help to further bring down Panasonic batteries' prices, which are already 10 per cent more than those of its competitors.