The proposal, originally pitched in 2015, is strongly backed by the Prime Minister’s office after recent border tensions with China.
The Indian Defence Ministry will spend an estimated £555 billion ($750 billion) on next-generation shelters on eastern and northeastern airfields that border China.
The hangars are designed to withstand missiles and bombs of up to 2,000 pounds.
Last year a parliamentary panel on defence raised concerns about the lack of hardened shelters for frontline aircraft.
The committee said: “The IAF is already short of planes, and worse than that is hardened shelters are not available for even the limited number of aircraft that is available with the service…
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“The committee desires that there should not be any delay in execution, as such delays have become a common feature of all the projects.”
The proposed shelters would be in Leh, Ladakh and the northeastern states, covering the newly built advanced landing grounds along with the India-China border.
The Indian Air Force has built new weapon storage areas and labs in large numbers.
It constructed 16 shelters for Su-30 aircraft between 2004 and 2007 capable of withstanding 1,000-pound explosives.
Tensions between India and China were high this summer over their shared border.
From June – August, armed forces from both countries were locked in a stand-off along the border, known as the Donglang in China and Doklam in India.
Both countries are nuclear-armed and if tensions escalate it could have devastating consequences.
Eurasia Group Asia analyst, Shailesh Kumar, told CNBC: “Both sides stand to lose tremendously, economically speaking.”