For weeks, we've been following the trials and tribulations of Lockheed Martin (NYSE: LMT) and Boeing (NYSE: BA) in India. First, both companies were ignominiously ousted from the competition to sell New Delhi $10 billion worth of fighter jets. Then, Lockheed floated a plan to get back in, offering India shiny new F-35 fighters instead of stodgy old F-16s. But could it be that the best way to play India's recent defense spending splurge doesn't involve Lockheed or Boeing at all?

In fact, it just might be. Last week, confirmed India is taking a look at Honeywell's (NYSE: HON) F125N engine as a potential upgrade to its fleet of 120 British Jaguar fighter aircraft. The front-runner in this competition, Rolls-Royce, pulled out earlier this year. Forced to find a replacement, India seems to have lit upon Honeywell.

Potential winnings: $2 billion in incremental revenues for Honeywell. That's about 5.8% of annual revenues for the company -- not a bad haul for entering a "competition" where the only other competitor has dropped out ...

Foolish takeaway
Expect Honeywell to capitalize on its good fortune by demanding a hefty profit on its engines – but not too hefty. If Honeywell gets greedy, it could cause India to rethink, and invite General Electric (NYSE: GE) or United Technologies (NYSE: UTX) to make a counteroffer.

The contract's not official yet, of course. Can Honeywell seal the deal? Add it to your watchlist and find out.

Fool contributor Rich Smith has no position in any company named above, but The Motley Fool owns shares of Lockheed Martin. The Motley Fool has a disclosure policy. Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors.