Berlin: European consortium, EADS, the parent company of Franco-German aircraft maker Airbus, may start production in India. Chairman Louis Gallois said Tuesday that his Group needs to be closer to its customers.

"If we want to sell in India, we have to produce in India. There are lots of engineers in India," Gallois said at the Berlin Air Show. "India is a priority country."

India is a 'partner nation' at the Berlin show, which kicked off Tuesday with a formal inaugural at the hands of the German chancellor Angela Merkel. The biannual show, the third biggest in Europe after Farnborough, England and Le Bourget, Paris, is also the world's oldest.

India has already bought defence hardware worth $25 billion since 1999 and  is expected to spend another $30 billion by 2012 to fund the ongoing modernisation of its military. It has large orders for fighter aircraft and helicopters, naval ships and army hardware in the pipeline, which are of intense interest to defence companies around the world.

Apart from the military, India also has a booming civil aviation sector, which has its own large aircraft and infrastructure requirements.