Nokia, the mobile phone and network company, has announced a $111 million (€92.54 million) joint venture with Chinese counterpart China Putian as it positions itself to win a share of the anticipated $10 billion spend on third generation mobile networks.

The Chinese government is expected to ensure that at least 30 per cent of the investment in the latest mobile technology will go to domestic manufacturers offering TD-SCDMA technology developed in China.

European manufacturers, including Nokia, are hoping their WCDMA technology will become the standard but acknowledge the Chinese domestic standard is likely to figure strongly. Simon Beresford-Wylie, executive vice-president for networks, said it was vital for the Finnish company to include the standard in its line-up.

"People have been waiting for Nokia to put a stake in the ground on TD-SCDMA," Mr Beresford-Wylie said in an interview, saying investors and analysts had been expressing concern on the issue.

"We believe TD-SCDMA will be part of 3G here in China and if we don't have TD-SCDMA within the portfolio, we rob ourselves of the ability to address the whole market," he said. Supporters of TD-SCDMA in China say Beijing regulators should make at least one operator use the standard for a national network when it issues long-awaited 3G licences.

The government is now expected to issue licences in the first half of next year, but operators are reluctant to embrace TD-SCDMA amid concerns about the technology's maturity and the lack of interoperability that will deprive them of lucrative "roaming" business.Nokia's move to establish a TD-SCDMA presence follows similar steps by rivals Ericsson and Siemens. The Chinese contracts are crucial as they are expected to give the winning manufacturers the scale to survive.