India on Thursday approved a $8.5 billion budget to buy missiles, helicopters, artillery guns and electronic warfare systems as it looks to strengthen military capabilities. The Defence Acquisition Council (DAC), the top government body for capital acquisition approvals for the Indian military, approved the orders for all its services, the Defence Ministry said in a statement. Meanwhile, the U.S. State Department approved sales of almost $900 million worth Tomahawk missiles to Australia on the same day.

All of India’s orders would be placed with Indian companies, as part of Prime Minister Modi’s bid to ramp up domestic defense manufacturing.

The spending comes as India’s relations with neighbors Pakistan and China remain tense and as the government has been looking to modernize its mostly Soviet-era military equipment.

The focus on the navy, which accounted for approvals worth almost $7 billion on Thursday, comes after India expressed concern last year over Chinese activity in the Indian Ocean.

The list of purchases approved included 200 additional BrahMos missiles, 50 utility helicopters and electronic warfare systems for the navy.

BrahMos is a supersonic missile with a range of around 300 km that has been jointly developed by India and Russia. All three Indian military services have been using versions of the missile for over a decade.

The DAC also approved manufacturing of a diesel marine engine, which will be a first for India, and the air force’s proposal for a long range stand-off weapon to be used by the Sukhoi-30MKI fighter jet.

In separate news on Thursday, the U.S. State Department has approved the potential sale of Tomahawk cruise missiles to Australia in a deal valued at up to $895 million, the Pentagon said.

The package would include up to 220 Tomahawk cruise missiles and technical support.

Despite approval by the State Department, the notification does not indicate that a contract has been signed or that negotiations have concluded.