NEW DELHI (REUTERS)- India signed a contract on Wednesday (July 27) to buy four maritime spy planes from Boeing for about US$1 billion (S$1.4 billion), defence and industry sources said, aiming to bolster the navy as it tries to check China's presence in the Indian Ocean.
India has already deployed eight of the long-range P-8I aircraft to track submarine movements in the Indian Ocean and on Wednesday exercised an option for four more, two defence ministry officials and an industry source told Reuters.
"It's a follow-on order, it was signed today," a defence ministry official said, speaking on condition of anonymity as he is not authorised to make announcements on procurements.
A second defence official confirmed the value of the contract at about US$1 billion and said the aircraft were expected to enter service over the next three years.
Amrita Dhindsa, a spokeswoman for Boeing defence, space, and security in India, said she was not in a position to say anything on the contract and referred all questions to the defence ministry.
But she said the P81 was an aircraft used for not only for long-range patrol but was also equipped with Harpoon missiles for anti-submarine warfare.
India has been building up its naval surveillance capabilities since China's navy expanded its reach and sent submarines, including a nuclear-powered boat that docked in Sri Lanka, across the Indian Ocean.
The deal, signed during a visit by the US Under Secretary of Defense for Acquisition Frank Kendall, marks a further tightening of India's ties with the United States, which has emerged as a top arms supplier in recent years for India's largely Soviet-equipped military.
A US embassy spokesman was not immediately available for comment.
Boeing last year completed the delivery of the last of the aircraft under the previous order worth US$2.1 billion, an industry source said.
The Indian navy has deployed some of its P8-I aircraft to the remote Andaman and Nicobar islands near the Malacca Straits and two other routes into the Indian Ocean for military and commercial shipping.