France's President Francois Hollande played down the prospects of a swift conclusion to a drawn-out deal for New Delhi to buy 36 French fighter jets as he began a three-day visit to India Sunday.

The invitation for Hollande to be chief guest at India's Republic Day military parade on Tuesday had raised expectations that the multi-billion dollar agreement for the Rafale jets would finally be sealed.

But on landing in the northern city of Chandigarh, Hollande cooled talk that the contract was on the verge of being signed, saying further discussions were needed on a prior inter-governmental agreement.

"We are going to take another step on the road which we hope will lead us to India's acquisition of the 36 Rafale jets," he told reporters.

"India needs them and France has shown that it has the world's best aircraft.

"The commercial contract can only come after the inter-governmental accord... which will be discussed during my visit."

In an interview with the Press Trust of India news agency, Hollande said the eventual deal would "pave the way for an unprecedented industrial and technological cooperation" for the next four decades.

"Agreeing on the technicalities of this arrangement obviously takes time, but we are on the right track," he added.

Prime Minister Narendra Modi announced in Paris last year that his government had agreed to buy the jets as India looks to modernise its Soviet-era military and keep up with neighbouring Pakistan and China.

The two leaders stepped into the long-delayed deal after torturous negotiations over a much-larger agreement first signed with France's Dassault Aviation in 2012 broke down.

A sticking point has been Delhi's insistence that arms makers invest a percentage of the value of any major deal in India, known as the offset clause.

Hollande began his second official visit to India in Chandigarh, which was designed by French architect Le Corbusier more than 60 years ago.

He and Modi were to stroll through Chandigarh's renowned rock garden, with its sculptures made out of rubble from the city's construction.

The French leader, who is travelling with a number of senior cabinet ministers and a large business delegation, will also address a forum of Indian CEOs along with Modi in the evening.

In a Tweet, Modi said he was "honoured & delighted" to host Hollande and pledged to "build on the ground covered during our previous interactions".

On Monday, the leaders are expected to announce a roadmap for building six French nuclear reactors in western Maharashtra state, more than five years after a bilateral civil nuclear cooperation agreement was signed, according to the Times of India newspaper.

They will also lay a foundation stone at the new headquarters of the International Solar Alliance, a 121-nation group launched by Modi at the Paris COP21 conference in November, to expand affordable solar power.

 Solar push

 Hollande said he hoped some of the French businesses travelling with him would be at the forefront of the solar energy push. 

"We are going to translate our shared commitment to implement what was agreed in Paris into action by launching the solar alliance here," Hollande said at Chadigarh's military airport.

Security will be high on the agenda after deadly Islamist attacks in Paris in November that evoked memories of the 2008 Mumbai attacks, which left 166 people dead.

India launched a nationwide security crackdown in the lead-up to Republic Day, arresting a string of suspected Islamic militants.

Security was tight for Hollande's arrival, with armed police and paramilitary forces patrolling the streets of Chandigarh. 

Hollande and Modi are expected to sit side by side to watch Tuesday's pomp-filled spectacle of military might -- that includes columns of soldiers and Soviet-era tanks -- along Delhi's central Rajpath avenue.

The parade is the highlight of annual celebrations of the birth of modern India. US President Barack Obama was last year's chief guest.