India signed an inter-governmental pact on Monday to buy 36 fighter aircraft from France, with the financial aspects of the deal still to be decided in final negotiations.
The purchase of the Rafale combat jets, built by French company Dassault, is considered to be among the world's biggest defence deals.
Another 13 agreements covering cooperation in areas of space, science and technology and railways were signed after talks between French President Francois Hollande and Prime Minister Narendra Modi in New Delhi.
India and France had finalized the inter-governmental agreement barring the financial aspects, Modi told the press alongside Hollande following the talks.
"It is a decisive step for India to purchase the fighter jets and for France to make them available to such a great country," Hollande said, adding that financial aspects would be sorted out in "a couple of days".
In a statement, Dassault said French authorities were working to finalize a complete agreement within the next four weeks.
The deal for the jets, is estimated to be worth 600 billion rupees (9 billion dollars).
In comments on Monday, Hollande said the inter-governmental agreement would provide a framework by which the commercial contract could be concluded.
New Delhi is in the midst of modernizing its armed forces to keep up with neighbouring rivals Pakistan and China. The government had first announced the deal in 2012, but the acquisition has been delayed since then.
India is the world's largest importer of military equipment by volume, the Stockholm International Peace Research Institute, a global security think tank, said last March.
Other deals included French space agency CNES' participation in India's next Mars mission and a joint venture between Indian Railways and France's Alstom to produce 800 electric locomotives.
French companies will invest 10 billion dollars in India over the next five years, mainly in the industrial sector, French Finance Minister Michel Sapin said.
Both sides are also looking to boost bilateral trade pegged at 8 billion dollars in 2014.
India and France said they would step up their cooperation in the fight against terrorism by enhancing intelligence sharing.
The meeting came on the heels of terrorist attacks in both countries. Militants struck at a key air force base in northern India earlier this month, while attacks by Islamic State militants left 130 people dead in Paris in November last year.
Hollande also said both countries were also working to conclude an agreement within a year on a French nuclear company Areva building six nuclear reactors in western India.
Later on Monday, Modi and Hollande travelled by Delhi Metro to the suburb of Gurgaon where they laid the foundation stone for the headquarters of the International Solar Alliance, an initiative launched by both leaders at the Paris climate talks last month.
Hollande, accompanied by top French ministers, opened his three-day tour to India on Sunday with a visit to the northern city of Chandigarh where he participated in a business summit.
The French leader will be the chief guest at the country's Republic Day military parade on Tuesday. The day marks the adoption of India's Constitution.
The Indian capital was put under an unprecedented security cover for the visit, especially in view of a terrorist attack on an air force base in the region earlier in January.
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