Bangladesh will be the first country to move its embassy from Yangon to the new city and capital Naypyitaw, Myanmar's official newspaper said.

Bangladeshi Prime Minister Sheikh Hasina, on an official three-day visit to Myanmar, formerly called Burma, unveiled the foundation stone at the site chosen for the construction of the embassy, the New Light of Myanmar reported.

The country's junta pronounced Naypyitaw, around 200 miles north of Yangon, as the capital in November 2005, although the site wasn't given an official name until March 2006.

The planned inner city with its wide, and mostly empty boulevards, is still being constructed and is home to many of the former ruling military leaders. The surrounding countryside and its towns and villages that make up Naypyitaw have a population of around just less than 1 million, a 2009 report said.

In August, Russian media announced that a Russian firm had won a contract to construct 30 mile of subway lines, the first for the Asian country.

The expansive layout of the inner city has enabled military leaders to present large military parades.

However, the diplomatic corps has been slow to move from Yangon, formerly called Rangoon and a historic port city.

An official from Naypyitaw Municipality told The Irrawaddy news Web site this month that 120 sections of land have been reserved for foreign embassies.

The official said China, India, Saudi Arabia and Russia will be moving their embassies from Yangon.

Hasina's visit to Myanmar is the first by a Bangladeshi prime minister in eight years and she reportedly discussed increased trade, including the purchase of natural gas, with Myanmar officials.

Trade between Myanmar and Bangladesh was $137 million this year. Bangladeshi and Myanmar ministers said they want to boost that to around $500 million annually within the next several years, the Irrawaddy report said.

But the two countries also must resolve the issue of 220,000 Rohingya people, Muslims from Myanmar, sheltering in refugee camps in Bangladesh. They fled rebel fighting with Myanmar's army and also ethnic discrimination in their native Arakan state in Myanmar.

A report in the Daily Star newspaper in Dhaka, capital of Bangladesh, said an agreement had been reached between Myanmar President Thein Sein and Hasina for Myanmar to repatriate the refugees.

The agreement depends on verification of refugee status by third parties, including the U.N. High Commission for Refugees that has been monitoring the Rohingya situation.

No date for repatriations to start was given in the Daily Star report.