The official, who is a member of a delegation accompanying French Defence Minister Michele Alliot-Marie on a two-day visit to India, said the negotiations were almost finished.

"We have reasons to believe that the deal could be finalised this summer," a member of the delegation told AFP.

The two billion euro (2.1 billion dollar) project involves the construction of six Scorpene submarines and a partial transfer of technology.

New Delhi plans to make the submarines at Mazagon Docks in western India as there is no proposal to purchase the submarine outright.

Earlier this year defence officials said the diesel-propelled Scorpenes, each weighing about 1,600 tonnes when under water, would be built over 15 years at Mazagon.

The first Indian-built Scorpene is expected to be ready in 2010 and the sixth in 2016.

India is also planning to buy around 130 multi-role fighters, and French aircraft manufacturer Dassault Aviation is pursuing talks with New Delhi on selling a number of its Mirage 2000s/2000-5 warplanes.

Other rivals in the race are Lockheed Martin of the United States, which is offering its F-16 fighting Falcons, and Russia with its upgraded MiG-29 and Sukhoi-30MKI warplanes.

But the delegation member said the discussions on the sale of the Mirage 2000s "were not at the same stage" as the Scorpene talks.

"We are following the project with great attention. We still need other discussions...," the official said.

Alliot-Marie, who arrived in India Sunday, visited the northern town of Agra, famed for its marble monument to love, the Taj Mahal.

According to a statement from the French embassy in New Delhi, she will meet Deputy Prime Minister Lal Krishna Advani and her Indian counterpart George Fernandes on Monday.

She will also hold talks with the chiefs of India's army, navy and airforce.

"It is significant to hear the opinion of countries such as India on the design of a multipolar world, evoked by president Jacques Chirac at the time of his visit in India in 1998," said the official.

"And within this framework, the intention of France is to accompany India's rise to power, including in military cooperation."

On relations between India and its nuclear rival Pakistan, the delegate member said France wanted stability in the area.

When Advani visited Paris in January he had asked France and the international community "to cease militarily helping" via the sales of weapons to "countries like Pakistan which support terrorism."

India accuses Pakistan of being an "epicentre of terrorism" and supporting Islamic militants fighting Indian rule in Kashmir.

SPACE.WIRE