The Karnataka Power Corporation Ltd (KPCL) inked a deal with the Chhattisgarh government on Monday, September 8, 2008 to build a 1,200 MW thermal plant in the state by investing Rs.60-billion. Sources inform that this plant will probably come up in Chhattisgarh's northern region, where the mines of India's state-owned coal producer South Eastern Coalfields Ltd are located.

The first unit of the thermal plant will be commissioned by October 2012. The KPCL was set up in 1970 outside Karnataka and this will be its first project. Sources inform that the Chhattisgarh government has guaranteed the KPCL early provision of land as well as coal linkage under the industrial policy of state. The deal between the two BJP-ruled states was signed in the presence of Karnataka CM BS Yeddyurappa, who described it as 'a milestone in inter-state co-operation'.