France has asked India to pay 7.25 billion Euros for 36 new jets, a deal which has been stuck for months over pricing issue.
This offer also includes an offset clause that would make Dassault and Thales invest in the Indian defence and security sector.
France has agreed to a 50 percent offset clause.
The latest offer is likely to be the last one. Earlier, France had asked for 8.8 billion Euros.
Meanwhile, both the countries are also in talks over a five-year support package for the fighter jets, down from the ten-year package that was being discussed earlier.
ET quoted sources saying that the weapons package will be signed separately as has been the norm but the original requirement has been pruned.
"The Rafale deal is in quite an advanced stage and we intend to close it quite soon," Defence Minister Manohar Parrikar had said.