French Defence Minister Michele Alliot-Marie said on Monday a multi-billion dollar deal to sell submarines to the Indian navy could be sealed by the end of the year.

The contract, which analysts say could be worth $1.8 billion, involves the manufacture of six Scorpene SSK-class submarines at a naval dockyard in Mumbai.

"It is very likely to reach fruition point by the end of the year," Alliot-Marie said after talks with her Indian counterpart, George Fernandes, and chiefs of the army, navy and air force.

Indian defence ministry officials said the navy had found the French submarines suitable, but the Cabinet Committee on Security had to clear the deal.

France is also bidding for the sale of Mirage fighter planes for the Indian air force, but officials said those negotiations were in a preliminary stage. India bought around 40 Mirage aircraft in the 1980s.

"I haven't come here to sign a contract, I came here to demonstrate the intensity of our wish to maintain our partnership and enhance it," the French minister said.

India, which largely relied on the former Soviet Union for its arms supplies, has since turned to Israel, Britain and the United States for new military equipment.

The deal will be the first time the Indian navy will be buying submarines from France. It currently operates a largely Russian fleet and a few German-built submarines.