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NEW DELHI (PTI): India has started making payments to French defence major Dassault Aviation for upgrading its fleet of Mirage 2000 aircraft under a deal worth USD 2.4 billion.

The Indian Government has started making payments for the deal to upgrade the Mirage aircraft, sources told PTI here.

As a result of the payments released for the deal by India, the price of dollar was impacted upon in the exchange on Wednesday.

As per the proposal, French firms Dassault and Thales will upgrade the aircraft, which will add 20-25 years to the life of the Mirages, inducted by the Indian Air Force (IAF) in the mid-80s.

Two different proposals, one for the upgrade of systems of the aircraft and the other for over 400 MICA missiles for the upgraded fleet, were placed before the CCS.

Under the deal, the French firms will help in upgrading the avionics, navigation systems, mission computers, electronic warfare systems and radars bringing the aircraft to the Mirage-2000-5 standards.

The French companies will have to invest over USD 900 million into the Indian defence sector as defence offsets.

As per the Indian defence offsets policy, foreign vendors bagging deals worth over Rs 300 crore have to invest at least 30 per cent of the worth of the deal back into the Indian defence, civilian aerospace and homeland security sectors.

As per the agreement, India has sent two of its aircraft to France for upgrades and thereafter the rest would be upgraded at Hindustan Aeronautics Limited facilities.