India and Israel are poised to sign a $100 million deal for the supply of Barak anti-ship missiles for Indian warships despite its recent unsuccessful test launch.

To date the Indian Army has purchased some $260 million worth of Barak missiles from Israel but the upcoming deal with Israeli Aircraft Industries (IAI) will be the Indian Navy's third purchase of the missile.

The surface to-surface Barak missile is produced in Israel and in service with Israeli Navy's Saar 5 patrol boats. India had first mounted the system on its aircraft carrier INS Viraat.

The Haaertz daily said the Barak missile during a recent test by the Indian Navy veered off course and fell into the sea. It attributed the failure during the launch to problem in communication frequencies between the missile and the warship.

Another possible reason for the failure was a problem in the missile's control and guiding system that stopped the missile's flight, the daily reported.

However, a second missile launched in the same test hit its target accurately, sources said.

India has emerged as one of the largest buyers of Israeli military hardware in recent years and is acquiring the Phalcon early warning radars. Both sides have also discussed the transfer of the Arrow-2 surface-to-air missiles as part of India's defence against ballistic missiles.