The JV is being set up to develop Indian capabilities to integrate and maintain radars and manufacture high performance airborne electronics, leveraging Thales' offset commitment as part of the deal for the supply of 36 Rafale fighter aircraft to Indian Air Force.
Thales is a leading supplier of radars, electronic warfare solutions and software to Dassault Aviation that manufactures Rafale jets.
"We are delighted to seal this strategic collaboration with Reliance Defence Limited. This JV resonates with our strategy to strengthen our industrial footprint in the country by building collaborations with the Indian industry," said Patrice Caine, chairman and CEO of Thales, after finalising the deal in Paris.
Anil Ambani, chairman of the Reliance Group, called the "strategic partnership" with Thales yet another milestone for his company.
"The strategic partnership with global leader Thales is another major milestone in our march towards best in the class manufacturing at support facilities for military hardware in India," he said.
Reliance, he added, was committed to the government's 'Make in India' and 'Skill India' initiatives and would continue to remain in the forefront, partnering with leading companies in the world.
The JV would develop skills and activity in the Special Economic Zone of Mihan-Nagpur together with an Indian supply chain for the manufacturing of microwave technologies and high performance airborne electronics, the two companies said in a joint statement.
Thales is a leading company in the aerospace domain. It currently has over 300 employees working with its wholly-owned Indian subsidiary, Thales India Pvt Ltd.
India in September last year had inked a Euro 7.87 billion (approx Rs 59,000 crore) deal with France for the purchase of 36 Rafale fighter jets capable of carrying nuclear weapons and equipped with latest missiles.
The Rafale combat aircraft to be manufactured by French aviation company Dassault will come with various India- specific modifications.