Paving the way for bilateral strategic and security cooperation, India and Germany have signed their first-ever defence pact encompassing joint training, technology transfers and co-production of hi-tech military hardware.

The Indo-German defence cooperation agreement, which would help New Delhi broadbase its military equipment suppliers to make arms purchases more competitive, was signed on Wednesday by Defence Minister Pranab Mukherjee and his German counterpart Franz Josef Jung. Though both refused to elaborate on the areas the pact was aimed at, Jung said it would cover exchange of cooperation in navy and in electronic and surveillance systems, in which Germany has made big breakthroughs.