China Construction bank has expanded its infrastructure in India to help expand its operations, in a move that comes ahead of the first-ever joint-venture of the two countries.
Changsha Construction Bank and Shanghai Construction Bank will jointly operate the infrastructure bank’s branch network, a senior official of the Chinese government told CNBC.
The branch network will be operational in the capital cities of both the Asian countries, the official said.
It will be the first joint-ventures of the three branches, which have been in existence for almost a decade, and it will help strengthen the bank’s infrastructure in both countries, said the official.
The bank also plans to establish a regional headquarters in New Delhi, the first such center in India.
China Construction Bank has been providing infrastructure in China and India for nearly three decades, and has been working with both countries to help build their economies and promote trade and investment.
It has also worked to improve the quality of the infrastructure in the two regions.
Last month, the two sides signed a memorandum of understanding to expand the network, with construction projects in the next two years.
The two countries had signed the agreement in 2015 and signed a new one in 2018.
The agreement also included a $6.3 billion loan guarantee from the China Development Bank.
The development will allow the Chinese construction bank to invest in infrastructure in areas where it has a business, such as roads, power grids and water and sewer infrastructure, the officials said.
The joint-investment will boost China Construction Banks overall growth rate and will also help the bank grow its capital stock and help it meet future needs, the bank official said in a statement.
The Chinese construction banking is the countrys second-largest banking system.
It operates in a range of sectors, from infrastructure and construction to manufacturing, telecommunications, real estate and financial services, according to Bloomberg.