India and China have signed 12 agreements in Delhi, one of which will see China investing $20bn (£12.2bn) in India’s infrastructure over five years.
At a news conference with Chinese President Xi Jinping, India’s PM Narendra Modi said “peace on the border” was important for progress.
Talks came as India accused China of fresh territorial incursions in Ladakh.
China is one of India’s top trading partners but they vie for regional influence and dispute their border.
Mr Modi and Mr Xi made separate statements at the end of their talks in Delhi on Thursday.
Under the investment plans, China pledged to:
Help bring India’s ageing railway system railway system up-to-date with high-speed links and upgraded railway stations.
Set up industrial parks in Gujarat and Maharashtra.
Give more market access to India to products, including pharmaceuticals and farm products.
Both sides also focussed on increasing co-operation in trade, space exploration and civil nuclear energy.
Mr Modi called for an early settlement on the disputed common border between the two countries and said the “true potential of our relations” would be realised when there was “peace in our relations and in the borders”.