NEW DELHI (AFP) - India's defence minister on Thursday ruled out any prospect of a deal to buy fighter jets from France's Dassault Aviation before national elections - expected by May - due to budgetary constraints.

The announcement eliminates any chance of the current government concluding its biggest defence procurement project and means the French firm faces new uncertainty in its most promising export market.

"Because of shortage of money don't expect this (financial) year any final decision or agreement," Defence Minister A.K. Antony told reporters in New Delhi at a news conference.

The financial year runs until the end of March, but elections are then expected shortly afterwards when the ruling Congress party is expected to be voted out of power.

India chose privately-owned Dassault in January 2012 for exclusive negotiations for 126 fighter jets - worth US$12 billion (S$15.2 billion) - but successive deadlines to complete one of the world's biggest defence contracts have slipped by.

In October, Air Marshal S. Sukumar, deputy chief of air staff, was reported to have said that the deal would be signed within the current financial year.

India's Finance Minister P. Chidambaram has imposed strict spending limits on government ministries as he battles to control India's public spending deficit which he has promised will not exceed 4.8 per cent of Gross Domestic Product this financial year.

Dassault has struggled to find any overseas buyers for the Rafale and lost out in December to Sweden's Gripen in a contract in Brazil worth more than US$5 billion that had been under negotiation for a decade.