India hopes to sign a $12-billion deal to buy Rafale jets from France's Dassault Aviation by the middle of the year, the country's air force chief said Thursday.

Air Chief Marshall NAK Browne told reporters at India's air show that what should be the world's biggest defence deal was "very much on track".

"If all goes well, we will be in a position to sign the contract before middle of the year," Browne added.

The project will involve the production of 126 state-of-the-art fighters in France and India over a 15-20 year period, with an option to add an additional 63 jets to the order under a separate contract.

Negotiations will continue next week when France's President Francois Hollande makes his first visit to India since being elected last May.

"We want it to happen as early as possible for induction soon," Browne said, speaking on the sidelines of Aero India in the southern city of Bangalore.

The Rafale beat off stiff competition from six rivals from Russia, the US and Europe last year when India selected the French fighter to replace its ageing fleet.

Under the proposed deal, the first 18 aircraft are to be made in France with the remainder to be produced under licence by Hindustan Aeronautics Limited (HAL), the state-run Indian aerospace behemoth.

The Rafale has carried out bombing missions in Afghanistan, Libya and most recently in Mali, where it is currently flying sorties targeting Islamist militants.