That's pretty much exactly what it is, according to Perfect Works.

As for Xenosaga, what I see it as is more or less a spiritual successor, or even a re-imagining of what Tetsuya Takahashi had in mind for Episode I of the Xenogears series. Many many things fall neatly into place from both stories, such as the Link Experiment on Ariadne, Michtam being wiped out, the immigrant fleet, etc.

It's a shame both series died out well before their time, but both were also created in a time when games weren't really looked upon as a means for great deep storytelling. If both games were made now with current technology and public mindframe, I have a feeling they would have fared better. Not to mention we would more than likely have a more fleshed out second half of Xenogears. Perhaps if Sony and Square deem it a good idea to release Xenogears to the PSN we'll see a remake somewhere down the road?