Christian Michel James is accused of arranging kickbacks to Indian officials to secure a deal for AgustaWestland to supply New Delhi with 12 helicopters for 556 million euros ($630 million).
Italian prosecutors suspect illegal sweeteners worth about 10 percent of the contract, or some 55 million euros, were paid out in bribes. India cancelled the deal in January 2013.
James, who in previous interviews with Indian newspapers denied any wrongdoing, was detained in Dubai in February 2017 following an Indian arrest warrant and an Interpol notice.
Indian Prime Minister Narendra Modi's Bharatiya Janata Party (BJP) has sought to capitalise politically on the scandal as the contract was signed under the previous government of the Congress party.
The BJP said on Tuesday that the case could spell "serious trouble" for the "first family" of Congress, referring to the party's long-powerful Nehru-Gandhi dynasty, Indian media reported.
In Italy, the former head of AgustaWestland and of parent company Finmeccanica were given jail sentences in 2014 over the scandal but they were later acquitted.
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