Mega Defence Deals on US Defence Secretary's Delhi Agenda

The US Defence secretary described India as a country that will help shape a "new world order" that is emerging in this century. "I come about a month before the new Indian Prime Minister will be in the United States and meeting with President Obama. So this is a - I think an opportune time to spend a couple of days here listening, learning, and getting acquainted," he said.

Mr Hagel's trip follows one by US Secretary of State John Kerry last week and is part of the build-up to PM Modi's talks with President Barack Obama in Washington in September. (John Kerry Meets PM Modi in Prelude to Washington Summit)

Sources said there could be discussions during Mr Hagel's visit about India procuring heavy-lift and attack helicopters, anti-submarine jets and transport aircraft from the US.

India is likely to buy Apache gunships and 22 Chinook attack helicopters, both built by Boeing - the deals are expected to feature in Mr Hagel's meetings with Defence Minister Arun Jaitley and the Chairman of the Chiefs of Staff Committee, Air Chief Marshal Arup Raha.

Sources say Mr Hagel hopes to persuade India into a follow-on order of 39 AH-64D Apache helicopters in addition to the 22 now being negotiated. The two sides have been wrangling over the price of the gunships, with the initial deal having been estimated to be worth $1.4 billion.

The initial batch of Apache helicopters is meant to replace the Indian Air Force's ageing fleet of Soviet-era aircraft and will be armed with Hellfire and Stinger missiles.

The Indian Army has separately requested a fleet of at least 39 of these attack aircraft, some of which will be deployed as part of a new mountain strike corps it is raising along the disputed border with China, an army official said.

The two sides are also in talks to finalise a contract for the Indian Air Force to buy 15 CH-47FChinooks, a twin-rotor helicopter capable of lifting heavy loads, also valued at $1.4 billion.

The cabinet has just cleared a proposal to allow 49 percent foreign participation in the defence industry, up from a current cap of 26 percent, in a bid to boost local manufacturing and end a long dependence on overseas acquisitions that made India the world's biggest arms importer in recent years.

The Pentagon said Mr Hagel's talks will also cover military exercises and co-production and co-development of armaments. Mr Hagel said the purpose of his visit went beyond arms sales. "We need partners. We need relationships. That's the kind of world we live in, and that's the kind of world that we're going to be living in." (Chuck Hagel's Visit to Boost India-US Strategic Ties)