US Defence Secretary Ashton Carter, who arrived here this evening from Goa, will hold delegation-level talks with his Indian counterpart Manohar Parrikar tomorrow.
Freedom of navigation and joint exercises especially in the maritime field are among the issues that will be up on the table.
The two leaders had already met in Goa where Carter arrived yesterday.
Besides that meeting, Parrikar today hosted Carter on board India's Russian-made aircraft carrier INS Vikramaditya in Karwar.
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However, under the new dispensation, things have changed and India is open to a tweaked LSA which facilitates the provision of logistical support, supplies, and services between the US military and the armed forces of partner countries on a reimbursable basis, and provides a framework that governs the exchange of logistics support, supplies, and services.
Defence sources said that "progress" has been made with regard to LSA but added it does not mean that it is a done deal.
"The Americans will have to give pre-bid guarantee if their firm wants to take part in 'Make in India' programme for fighter aircraft. Companies promise moon but at the end, we should not be left with sand in our hands," a defence source said.