France's Dassault Aviation and India's Tata Advanced Systems have agreed to produce the fuselage of the Rafale fighter jet in India, Reuters reports, citing a joint statement from the companies.

It is the first time it will be produced outside of France. 

India, the world's largest arms importer, is looking to boost domestic production and boost defense exports, which rose 12% to $2.76 billion in the fiscal year to the end of March. As part of the agreement, Tata will set up a manufacturing facility in the southern city of Hyderabad to produce key structural components of the Rafale, the companies said in a statement.

The first fuselage sections are expected to roll off the assembly line in fiscal 2028, with the facility expected to produce up to two complete fuselages per month. The statement did not specify how much the deal would cost or whether the finished product would be for domestic use or export, but Tata Advanced Systems said the fuselage would be “destined for India and other global markets”. 

The Indian Air Force currently has 36 Rafale fighter jets in service. In April, India also signed an agreement with France - its second-largest arms supplier - to buy 26 naval versions of the fighter jets for $7 billion, expected to be delivered by 2030.