Both countries signed a contract for India to buy 80 Mi-17 transport helicopters (Mi-17), worth more than $1 billion, said Anatoly Isaikin, head of Russia's state-run arms-export monopoly Rosoboron.
India, which wants to buy billions of dollars of weapons as it rearms, has been unhappy with holdups on major Russian arms contracts, including a delay to a $1.5 billion aircraft carrier modernisation.
"Our main task is to switch from buying or selling weapons to jointly designing and producing them. We have such plans in rocket building and aviation," Medvedev said.
India, along with China, is one of Russia's biggest clients for arms sales.
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