India has signed an agreement with France to buy 36 Rafale combat jets, but a final deal has yet to be reached as they work on the financial details.
Indian Prime Minister Narendra Modi made the announcement on Monday after holding talks with French President Francois Hollande, who is on a three-day visit to New Delhi.
“With the exception of some financial aspects, both sides have signed an intergovernmental deal.Both of us have also agreed to sort out the financial aspect of the deal quickly,” said Modi.
Hollande described the deal as a “decisive step.”
France has been pushing hard for years to wrap up one of the world’s biggest defense deals. India initially planned to take 126 of the jets, but scaled this back last year to 36. Although the price has yet to be finalized, defense analysts estimate it could be in the range of $9 billion.
India wants the combat aircraft to modernize its air force.
Indian Defense minister Manohar Parrikar shakes, right, hand with his French counterpart Jean-Yves Le Drian, second left, after exchanging the files of agreements on the buying of Rafale fighter jets in New Delhi, India, Jan. 25, 2016.
The French leader will be the chief guest at India’s Republic Day on Tuesday – when India celebrates its constitution with a military parade full of pomp and pageantry in the heart of New Delhi.
Hollande’s visit is seen as a signal of growing political and strategic ties between the two countries. Calling France a special friend, Modi said at a joint press conference with Hollande, “Eighteen years ago, France was the first country we signed a strategic partnership with.We are now here to take it higher.”
Both countries, which have been victims of recent terrorist attacks, signed a joint statement on fighting terrorism and vowed to step up cooperation in counterterrorism.
Hollande said that a new Islamic State video which threatens countries of the U.S.-led coalition fighting the terror group would only strengthen France's resolve to combat terrorism.
“They are provoking us in the worst possible manner, but this can only make us more determined, including myself," he said. "We shall also be extremely determined to strike time and again against ISIS, that organization which is threatening us and killing our children.”
The video is reported to show jihadists involved in last November's terror attacks in Paris.
The terror strikes in the French capital killed 130 people, while suspected Islamist militants attacked an Indian air base earlier this month.
Supporting the quest by developing countries for affordable and clean energy was also high on the agenda of the two leaders.
Hollande rode the metro along with Modi to Gurgaon, on New Delhi’s outskirts, where they laid the foundation stone of the headquarters of the International Solar Alliance, launched last month during the climate summit in Paris. The alliance aims to boost solar energy in developing countries that have ample sunshine.
Both countries also pushed commercial ties with France, eyeing investments in India’s fast-growing economy and New Delhi seeking much-needed investments.
France’s finance minister, Michel Spein, who is also in the Indian capital, said French companies will invest $10 billion in India over the next five years, mostly in the industrial sector.
The two countries signed 14 agreements spanning areas such as defense, civil nuclear cooperation, railways, smart cities, science and research, space and culture.