Our relations have developed steadily, Xi says as he hosts premier at banquet in hometown

Visiting Indian Prime Minister Narendra Modi enjoyed a festive day in Xi'an on Thursday, with President Xi Jinping accompanying him as people cheered the two leaders wherever they went.

"This is the first time I have received a foreign leader in my hometown," the president told Modi at the start of their meeting. It is also very rare for China's top leaders to accompany foreign guests outside the capital.

"I hope you have a great time here," Xi said. The president's family comes from Shaanxi province, and during Xi's visit to India in September, Modi took the Chinese president to his home state of Gujarat.

Modi visited the Terracotta Warriors and two famous temples in the province's capital that played significant roles in the spread of Buddhism from India to China.

The city held a ceremony for Modi based on the royal welcoming events of the Tang Dynasty (AD 618-907), and Xi then hosted a banquet for him in a building on the ancient city wall.

The BBC noted that the day's events were very different from the way China normally receives foreign leaders.

"The Terracotta Army is a heritage of the world. It is a testimony to China's civilizational achievements," Modi wrote in the visitors book at the site, adding that he was "deeply impressed" by the way the warriors had been preserved.

As Modi was being driven along a busy street, he saw crowds of people who were hoping to see him. He asked the driver to stop and left the car to greet them and shake hands, and they responded by waving and calling out his name.

"I know him, he is the Indian prime minister," said a passer-by surnamed Wang, who is in his 60s. "I have never seen such a scene."

The friendly welcome reflected the improving relationship between the countries, once marred by border disputes, a lack of trust and other issues.

During Xi's visit to India last year, he and Modi agreed to lead the neighbors toward a closer partnership and drafted a blueprint for strategic cooperation covering the next five to 10 years.

"Our relations have developed steadily," Xi said during Thursday's meeting, adding that the countries have pushed forward cooperation over railways and industrial parks and are managing the border region well.

He said the neighbors should look at their ties from a strategic viewpoint and take a long-term approach, and enhance "strategic cooperation" over international and regional affairs.

"India sees China as a great neighbor," Modi said, adding that he expects to raise the relationship to a higher level.

He said India seeks closer cooperation with China over the Asia Infrastructure Investment Bank proposed by Beijing, an initiative that will provide financial support for construction projects across the region.

Modi agreed to link China's "One Belt, One Road Initiative" to India's Act East strategy.

"The key aim of Modi's visit is to add fuel to India's development, based on the fact that the two nations are indeed forging a closer development partnership," said Hu Shisheng, director of the Institute of South and Southeast Asian and Oceanian Studies at the China Institutes of Contemporary International Relations.

Zhao Gancheng, an expert on South Asian studies at the Shanghai Institutes for International Studies, said deciding how to deal with China is a challenging yet important issue for the Indian government.

"The elites in India have reached a consensus that to achieve peaceful development, India has to handle the relationship with China well," Zhao added.