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German Chancellor Olaf Scholz wants to deepen defence ties with New Delhi and bring the two countries' militaries closer, he said on Friday, after meeting Indian Prime Minister Narendra Modi.

Germany has not traditionally had close defence ties with India, but is now pitching to join the latter's effort to wean its arms base from decades of dependence on Russia, at a time when the West seeks to counter China's growing influence.

"Our overall message is clear, we need more co-operation, not less," Scholz said.

"At our inter-governmental consultations with India, we also want to deepen co-operation in defence and agree to bring our militaries together."

Scholz, accompanied by most of his cabinet, is leading a high-level delegation to New Delhi, betting that greater access to the vast Indian market can reduce Germany's reliance on China.

German Thyssenkrupp is one of two bidders to have partnered with Indian firms to build six conventional submarines in India, in a deal estimated to be worth $5 billion.

The Indian Navy is expected to pick between the German company or Spain's Navantia soon.

New Delhi and Berlin are working on renewable energy projects, Modi said, among many possible investments in transport infrastructure.

"India is completely transforming its physical infrastructure," Modi told the Asia-Pacific conference of German business in the Indian capital, attended by Scholz.

"Record investments are being made. This offers many possibilities for German and Indo-Pacific region companies."

In 2022 Germany pledged 10 billion euros to help India achieve its climate goals.

German state lender KfW's unit DEG, which focuses on the private sector, plans to more than double investment in India to $1 billion over the next few years, focusing on renewable energy and infrastructure, an official, Jochen von Frowein, has said.

INDIA-EU FTA

Scholz reiterated his economy minister's push for swift progress on talks for a free-trade pact between India and the European Union.

"I am sure that if we work on this together, prime minister, this could happen in months rather than years," Scholz said.

Earlier, Trade Minister Piyush Goyal warned that India would be unable to strike such a deal if the bloc insisted on getting access to the Asian giant's dairy industry.

A trade deal could be swiftly reached if sensitivities were respected on both sides, Goyal told the conference, following Thursday's comments by German Economy Minister Robert Habeck that agriculture was the talks' "most problematic" area, and suggesting that they first tackle the industrial sector.

Progress has been slow on the talks, initially targeted to be wrapped up by the end of 2023, with India blaming the EU for what it called "irrational" standards, as one reason.