General Electric Company that had earlier bagged a contract to supply 17 engines to Hindustan Aeronautics Limited for production of light combat aircraft, Tejas, is in talks to supply 38 more engines for the project.

The deal is set to be around $250 million, GE executives said. The initial contract had a clause for supply of 38 additional engines.

"GE has set a sales target of $3 billion for India by 2008 for commercial and military aircraft engines," Allan Tarkenton, senior vice-president, global government and defence relations, GE, told Business Standard.

The company is also willing to supply engines for 10-tonne helicopters planned to be built by HAL. It is also set to offer upgrades for the Indian Air Force aircraft.

"Validation tests for the first 17 F404-IN20 engines for the light combat aircraft are nearing completion and initial deliveries for this programme are scheduled for mid 2006," Tarkenton said.

The firm was also awaiting clarity on the new procurement policy and the upcoming offset policy that govern technology transfer, in relation to future deals in India.

GE's bid to sell 38 engines will depend on Kaveri engines that are being indigenously developed to power the light combat aircraft.

The Defence Research Development Organisation had started developing Kaveri engine for the project after India faced delays in acquiring the GE-F404 engines after the Pokhran tests.