Prime Minister Narendra Modi invited Chinese President Xi Jinping to visit India later this year as the new Hindu nationalist leader extended another olive branch Thursday to one of New Delhi's traditional rivals.

The invitation was made during a phone call between the newly-elected Modi and his Chinese counterpart Li Keqiang in which both premiers expressed a desire for stronger ties, India's foreign ministry said.

Their conversation came only two days after Modi held landmark talks with Nawaz Sharif, the prime minister of India's other nuclear-armed neighbour, Pakistan.

"Prime Minister Modi extended through Premier Li an invitation to President Xi Jinping to pay a visit to India later this year," said a foreign ministry statement.

Li conveyed the "Chinese government's desire to establish robust partnership with the new government of India for further development of relations between the two nations", the statement added.

Modi said he wanted to work closer with the Chinese government to deal with any "outstanding issues in our bilateral relations" and "welcomed greater economic engagement between the two countries".

The last visit from a Chinese head of state to India was made by Xi's predecessor Hu Jintao in 2012 when the left-leaning Prime Minister Manmohan Singh was in power.

Modi, leader of the right-wing Bharatiya Janata Party, took office on Monday after winning a landslide election victory that swept the Congress party from power after 10 years of rule.

While there is heavy trade between India and China, relations are still dogged by mutual suspicion -- a legacy of a brief, bloody border war in 1962 over the Indian state of Arunachal Pradesh that is nestled in the eastern stretch of the Himalayas that China claims as its own.

- 'Expansionist mindset' -

In February, Modi had warned neighbour China to shed its "expansionist mindset" at an election rally in Arunachal Pradesh.

China hit back at Modi's remarks, saying it had "never waged a war of aggression to occupy any inch of land of other countries".

Relations between the two countries also took a hit in April last year when India accused Chinese troops of intruding deep into its territory in another remote region of the Himalayas, sparking a three-week stand-off that was only resolved when troops from both sides pulled back.

The countries have held a series of talks to try to resolve their border dispute but the frontier still bristles with tension.

At an annual defence and security dialogue in New Delhi earlier this year, the two countries had agreed to hold a high-level military meetings in India to discuss management of border issues.

The talks had also decided that their next joint army exercise would be in India in 2014 after a "successful" one in China last year.

China has been embroiled in a series of territorial and other disputes with its neighbours over the years, including Vietnam, which on occasion have led to armed conflict.

Beijing is also involved in multiple other disputes in the South China Sea, and has a bitter row with Japan over islands in the East China Sea.

Despite his reputation as a hardline nationalist, Modi invited Sharif to his inauguration ceremony on Monday in New Delhi, along with the leaders of several other neighbouring countries.