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A Chinese company and a Russian aviation institute have agreed to launch a private airplane production project in Northeast China's Jilin Province.

The cooperation, with a total investment of 800 million yuan (US$106 million), is expected to produce 500 two-seat and four-seat light aircraft and seaplanes for private use every year with an estimated revenue of 800 million yuan.

According to the contract signed on Wednesday by Jilin-based Dingxin Technology Co Ltd and the Moscow Aviation Institute at the ongoing Northeast Asia Investment and Trade Expo, the Chinese company will hold a 60-percent stake and the remaining 40 percent will belong to the institute, also known as Russia's state university of aerospace technologies.

The project, to be located in the Jilin Municipal Economic Development Zone nearly 100 km east of the provincial capital Changchun, is expected to partly meet increasing demand and to have favorable business prospects, said Wang Yunli, an official with the zone.

The planes are likely to enter the northeast Asian market after the project is put into operation, said Matveenko Alexander, principal of the institute, famous for its achievements that contributed to the development of Russian aviation and astronautics.

The two sides are still negotiating the details of the project.