A high level Chinese defence delegation led by Defence Minister General Cao Gangchuan would hold consultations with their Indian counterparts in Delhi on Monday.
The two sides will contemplate taking military contacts to higher levels.
Cao and the delegation from China arrived in New Delhi on Friday to a ceremonial welcome.
The delegation visited Bangalore and toured Hindustan Aeronautics Limited for over three hours. The HAL organised a special show of Dhruv, the indigenously developed Light Attack Helicopter, which India hopes to market to other countries.
He also saw the Jaguar structure and assembly shop at HAL. Officials in the Ministry of Defence said Cao enquired with HAL officials the possibility of future cooperation.
At HAL Cao also saw the Intermediate Jet Trainer developed indigenously and which India hopes to market globally. The IJT, India believes, could find a vast market in Asia and Africa because of its versatility and low cost.
In Mumbai, Cao led the 13-member delegation on a whirlwind tour of the Mumbai Dockyard and other naval installations.
There are hopes that the two countries would move towards having collaboration between their defence industries.
Cao would discuss the next steps of military relations between the two countries on Monday when he meets his Indian counterpart George Fernandes.
After Prime Minister Atal Bihari Vajpayee's successful visit of China last year the two navies had conducted a low-level exercise off Shanghai cost. Officials said the two sides are to discuss possibility of holding a more sophisticated joint exercises and may give an approximate timeframe to it.
Indian officials also say that they are looking at improving contacts between armies of the two countries. As of now it is limited to high level contacts, but indications are that they want to take it to joint exercises.
Officials said there won't be any detailed discussion on the border situation because already a high level dedicated dialogue between Special representatives of the two countries has concluded two rounds.
Cao and his team are here after visiting Pakistan and would proceed to Thailand.
