"The deal for Apache and Chinook (helicopters) has been cleared," government sources told PTI. The CCS, chaired by Prime Minister Narendra Modi and attended by Home Minister Rajnath Singh, Finance Minister Arun Jaitley and Defence Minister Manohar Parrikar, met after Cabinet meeting.
Many in the defence sector had expected the deal, valued to be around USD 2.5 billion and pending since 2013 following finalisation of cost negotiations, to be signed during the visit of US Defence Secretary Ashton Carter in June this year.
The US has been pushing for this contract as it will further bolster American presence in the burgeoning defence market of India.
Defence sources said that the deal will have an offset obligation of 30 per cent.
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Offset policy was first introduced as part of the Defence Procurement Procedure (DPP), 2005, under which a foreign company has to invest back a portion of the deal into India.
Modi will be undertaking a seven-day trip to Ireland and the US from tomorrow. The Prime Minister, who will commence his US trip from September 24 said, "This visit seeks to build on the substantial ground covered during my last visit to USA and President Obama's visit to India early this year."
The helicopter deal had survived over 10 price extensions from the American side with the last one being for a month as desired by India.
Both platforms, which have been in combat in Afghanistan and Iraq, had beaten off competition from Russia, which had offered its Mi-28N Night Hunter and Mi-26 heavy-lift copters.
The 22 Apache AH 64D Longbow helicopters are one of the most advanced multi-role combat helicopters, featuring all-weather and night fighting features, ability to track upto 128 targets in less than a minute and engage with 16, besides stealth characteristics, advanced sensors and beyond visual range missiles.
India will also be acquiring Hellfire missiles and rockets.