He said that there may be one or two more jet fighter plants, either operational or in the process of being set up, in India in the next three years or so.
Asked if this meant HAL will set up more plants, Mr Parrikar said, "It is private sector which will be required to supply to the air force. We need fighters. We may encourage...there are proposals."
Mr Parrikar said yesterday through "proper process", by year end "we might select few aircraft to Make in India. Which one? I don't commit. But there will be at least one, may be two also."
Boeing and Lockheed Martin of the US, Saab of Sweden, Dassault Aviation of France and Eurofighter have offered to set up manufacturing bases in India along with transfer of technology if their fighter aircraft was selected for Indian Air Force.
All the companies are also in talks with Indian private firms to select a local partner. However, they are awaiting a clear signal from the government before selecting their partners.
Mr Parrikar also made it clear that 'Make in India' does not mean just assembly of equipment but manufacturing through transfer of technology.
The development comes as both India and France are in the last stage of concluding an Inter-Government Agreement on direct purchase of 36 Rafale fighter jet planes.
The government has also decided to equip IAF, which is facing a severe fighter shortage, with indigenously developed Tejas combat aircraft.
HAL is already in the process of increasing its capacity to manufacture 16 Tejas aircraft per year.
Get Breaking news, live coverage, and Latest News from India and around the world on NDTV.com. Catch all the Live TV action on NDTV 24x7 and NDTV India. Like us on Facebook or follow us on Twitter and Instagram for latest news and live news updates.