According to reports, French President Francois Hollande and British Prime Minister David Cameron plan to sign a memorandum of understanding to build an Anglo-French Predator-type military drone.
The two sides will meet on Friday for a summit at Royal Air Force (RAF) Brize Norton, an airbase located near Oxford in southern England.
Britain's top arms producer BAE Systems and the French aircraft manufacturer Dassault Aviation will be working on the drone project.
The 500-million-euro contract is also reported to be including provisions for developing anti-ship missiles for French and British attack helicopters and underwater mine detectors.
In an earlier agreement in 2010, the two European countries agreed to share aircraft carriers and joint expeditionary forces.
A report by The Sunday People recently revealed that Britain’s Ministry of Defence (MoD) has spent £4 billion ($6.5 billion) to amass a force of 657 military drones despite the controversy over the secrecy of its deadly drone strikes overseas.
The fleet includes 10 MQ-9 Reaper drones, some 324 Black Hornet Nano micro-helicopters, 222 Desert Hawk UAVs, 63 Watchkeeper drones, 30 Tarantula Hawks, and 8 ScanEagles.