The JV will provide thorium fuel technology for light water reactors to come up in India, which predominantly generates nuclear power using LWRs.
The agreement for the equal-stake joint venture company will be signed in the first half of calendar year 2009.
"The joint venture will work on providing thorium fuel technology for nuclear reactors, advisory services for nuclear power plants and establishing a nuclear technology investment fund in India," said Seth Grae, president and chief executive officer of Thorium Power.
Grae, however, declined to reveal the quantum of investment in the JV company or the size of the proposed nuclear technology investment fund.
Thorium Power specialises in harnessing nuclear energy by using thorium, which is less radioactive than the conventional nuclear fuel -- uranium.
The US-based company also provides advisory services for emerging nuclear programmes.
"We are also looking at similar partners in other regions of the world," said Atul Punj, chairman of the Punj Lloyd Group.
Under its three-stage nuclear power programme, India has committed to develop a thorium fuel cycle for its planned 12 indigenously-developed nuclear reactors.
While India has only 0.8 per cent of the world's uranium reserves, it has about 32 per cent of the world's total reserves of thorium.
The three-stage cycle first involves processing of plutonium in pressurised heavy water reactors, through which uranium-233 is produced.
This uranium is then put into fast breeder reactors which then produces thorium.
This thorium is then used to produce nuclear power.
Anil Kakodkar, chairman of the Atomic Energy Commission had said that India is developing advanced heavy water reactors that will utilise thorium for commercial power generation.
NPCIL, India's state-owned nuclear power generator, is currently planning to construct about 30 light water reactors of 1,000 MW capacity by 2030.