Russian Premier Vladimir Putin will offer a traditional cocktail of arms and oil deals when he travels to India on Thursday to persuade a Cold War ally to buy new weapons amid rising competition with the United States.

The Russian economy shrank by 7.9 percent last year after a decade of oil-fuelled boom and Putin sees the defence sector as key to reviving growth. But Moscow often needs to offer incentives to sell its usually outdated military equipment.

Energy-hungry India is one of the world's top arms importers and plans to spend tens of billions of dollars on defence in the next years in a move causing unease in long-time foe Pakistan and regional rival China.

"The United States is gradually squeezing Russia out of the regional weapons market thanks to its technological superiority and political pressure," said Alexei Mukhin, who directs the Moscow-based Centre for Political Information.

"Since it is a second big Russia-India meeting over the past year, one could assume Putin wants to change that... It is almost guaranteed that new preferential energy deals for India would be discussed," he said.