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NEW DELHI (Reuters) - India signed a contract on Wednesday to buy four maritime spy planes from Boeing Co for about $1 billion, defense 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 defense ministry officials and an industry source told Reuters.
"It's a follow-on order, it was signed today," a defense ministry official said, speaking on condition of anonymity as he is not authorized to make announcements on procurements.
A second defense official confirmed the value of the contract at about $1 billion and said the aircraft were expected to enter service over the next three years.
Amrita Dhindsa, a spokeswoman for Boeing defense, space, and security in India, said she was not in a position to say anything on the contract and referred all questions to the defense 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 U.S. 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 U.S. 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 $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.
Editing by Robert Birsel