The leading contenders for the deal were Mazagon Dockyard Limited (MDL) and Garden Reach Shipbuilders & Engineers (GRSE).
The Ministry of Defence (MoD) was expected to clear the deal soon after the nature of the design of the frigates were under discussion for over a year.
The ships will likely feature an indigenous main fire control radar against the EL/M-2248 MF-STAR radars on previous designs as well as other advanced indigenous weapon systems.
The approval for other major projects and acquisitions like Future Ready Combat Vehicles (FRCVs) for main battle tanks of the Indian Army (₹50,000 crore (US$5.7 billion)) and 31 MQ-9B drones was granted.
Reports also suggested that the ships may weigh up to 8,000 t (7,900 long tons) and have significantly enhanced firepower and strike capabilities when compared to the Nilgiri-class.