New Delhi, Dec 3 (IANS): Automobile major Hero MotoCorp Tuesday said it has entered a joint venture (JV) agreement with Magneti Marelli of Milan, Italy, to produce engine systems for the two-wheeler market.

"This is our first JV since charting our solo journey and as an immediate opportunity and focus area, the new firm shall be taking up development and manufacturing of next-generation fuelling systems," said Pawan Munjal, managing director and chief executive officer, Hero MotoCorp.

"This is one of the most important areas in various technologies involved in making of better fuel-efficient, environment friendly modern engines."

According to the company, it will hold majority stake of 60 percent in JV company while Magneti Marelli will hold the rest.

The company will initially inject a total of $8.5 million in a ratio of 60:40 over a three-year period, while the total investment is likely to be around $27 million over the next 10-year period.

Hero is trying to spur its in-house technology development at its R&D centre and has tied up with three international companies for technology alliances.

Hero MotoCorp can use erstwhile partner Honda's technology inputs till 2014. Both the companies ended there 27-year old joint venture two years ago.

The new JV will also have its own autonomous development centre which will develop green and highly fuel-efficient products with lower emissions.

Other new products like electronic fuel injection (EFI) systems which will offer features such as immobilisers, traction, slip control, multi map, flexi fuel and multi fuel management systems.

The company added that the JV will bring key engine-related technology for two and three wheelers within the Hero Group, thereby reducing dependence on external vendors.