The Indian Air Force (IAF) has reportedly finalised the acquisition of 83 single-engine Tejas Mark-1A light combat aircraft (LCA) fighter jets.
The deal with Hindustan Aeronautics Limited (HAL) also includes maintenance and infrastructure.
Initially, HAL quoted nearly Rs565bn ($7.9bn) but the contract price has now decreased to a final amount of up to Rs390bn ($5.4bn), reported The Times of India (TOI).
The Mark-1A fighter jets are expected to be delivered three years after the agreement has been signed.
Under the deal, the Mark-1A jets will feature 43 improvements.
Some of the enhancements include active electronically scanned array (AESA) radar, long-range beyond visual range missiles, air-to-air refuelling and advanced electronic warfare.