Britain has warned India against selling British-made aircraft to Burma's military government. Indian officials say the British government wrote a letter to India's foreign ministry, calling for the sale to be scrapped. India says Rangoon wants to buy the BN-2 Islander aircraft for use in sea surveillance and ambulance missions.
Indian officials say the British letter hinted India would have difficulties buying British military equipment in the future if the Burma deal goes through.
India has signed agreements with Britain to buy spare helicopter parts and 10 second-hand Sea Harrier attack aircraft from the British Navy. But Indian officials fear those deals could be in jeopardy.
India's Navy chief Arun Prakash visited Rangoon last week to discuss cooperation with the Burmese military. But Indian officials say the dispute with Britain forced the Navy to keep the Burma visit a low-key affair.