The decision was taken at a meeting of the Defence Acquisition Council, the defence ministry's highest decision making body on procurement, they said.
Australia today signed a 50 billion dollars deal with France for 12 sophisticated submarines to be built by French defence major DCNS that was at the centre of a controversy this year surrounding the leak of documents relating to India's Scorpene submarines.
More than 22,000 pages of data about six submarines that France's DCNS is building for India's navy looked to have been stolen in 2011 by a subcontractor who was fired while providing training in India, the source said.
The refitting process will start from April 2016 and is expected to take four months for completion. The estimated cost for the process is Rs 200 crore.
The industry is delighted to see government thrust on defence orders, says Nikhil Gandhi, Chairman, Pipavav Defence adding that he expects clearance for more such proposals for Army, Navy and Air Force.
The government on Saturday cleared defence acquisitions worth Rs 80,000 crore.
CNBC-TV18's Archana Shukla reports, quoting sources, that the Mazagon Dock is considering partnerships with several private yards for faster execution of pending defence projects.
Engineering major Larsen and Toubro's shipyard being set up at Kattupalli near here would become operational by coming January, a top company official said today.
The state-run Mazagon Dock and private shipbuilder Pipavav Defence today formed the country's first public private partnership venture to build warships and submarines for the Navy.