India and China inked a historic agreement on Monday to institutionalise military training and exercise exchanges with a view to add more content to their emerging strategic relations.

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The memorandum of understanding was signed after Indian Defence Minister Pranab Mukherjee and his Chinese counterpart General Cao Gangchuan held over two hours of talks in Beijing [Images] at the Central Military Commission headquarters.

The MoU envisages other contacts between the armed forces, and defence officials and experts of the two countries. The MoU is also expected to serve as an instrument for a regular and sustained dialogue on defence and national defence issues between the two countries.

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Earlier, Cao accorded a red carpet welcome to Mukherjee, who is for a six-day official visit.

"Your visit is a big event in the exchanges and cooperation between the militaries and also an important event in the China-India Friendship Year this year," Cao said in his initial comments after a ceremonial welcome and guard of honour by a tri-service Chinese military marching contingent.

"Your visit this time will deepen our mutual understanding and mutual cooperation between the armed forces of the two countries," he said, while describing the Indian defence minister as an 'esteemed guest.'

Reciprocating the warm sentiments expressed by the Chinese General, Mukherjee said, "I have heard a great deal about China's achievements. This visit has allowed me to see for myself the achievements. We greatly admire your achievements."      

"I am bringing greetings from the Indian armed forces to the Chinese People's Liberation Army. I am also conveying the greetings from the people of India to the people of this great nation," Mukherjee said.

Mukherjee also described his meeting with Chinese Foreign Minster Li Zhaoxing as 'very productive.'

At the meeting, Li pledged to step up strategic and cooperative relations with India in 2006, a year of friendship between China and India, the official Xinhua news agency reported.

Li said that China attaches great importance to relations with India, noting that the common prosperity of China and India, with one third of the world's population, would be a huge contribution to humankind.

India and China are good friends and share similar views on many issues, Mukherjee said, adding that cooperation between the two countries and their active involvement in world affairs are conducive to the peace, stability and development of the world.

India will make concerted efforts with China to boost mutual understanding and trust in a bid to push forward bilateral relations, Mukherjee stressed.

During his stay in China, Mukherjee will also visit the headquarters of Lanzhou Military Region in Lanzhou city in northwestern China's Gansu Province and tour the Shanghai Naval Base in the country's economic hub in east China.

Mukherjee will on June 2 leave for Singapore on the next leg of his three-nation official visit.

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