Manmohan Singh is the first Indian premier to visit Myanmar, formerly known as Burma, in 25 years. Analysts say that India is stepping up efforts to woo the resource-rich nation and counter China's influence.
"India welcomes Myanmar's transition to democratic governance and the steps taken by the government of Myanmar towards a more broad-based and inclusive reconciliation process," the Indian prime minister said before setting out on his trip.
Analysts said that his visit was somewhat late, however. "India does seem to have been rather slothful in its response to Myanmar's reforms compared to the enthusiasm shown by many other world leaders," Rajiv Biswas, Asia-Pacific chief economist at IHS, told the AFP news agency.
"Myanmar is strategically very important for India and should be given a high foreign policy and economic policy focus as long as the reform process is continuing," he added.
On Monday, the Indian prime minister met Myanmar's President Thein Sein. The two sides then signed 12 agreements on issues ranging from security, the development of border areas, trade and investment, and transport.
India is already involved in several infrastructure projects in Myanmar, such as the construction of a new port at Sittwe, the capital of Rakhine State, on the Bay of Bengal, which is part of a river and road network that will help carve a trade route into Indian's landlocked northeast.
However, Beijing has a much more visible presence and observers say New Delhi has lagged behind because of a lack of political confidence between the two countries.
'More than ports and bridges'
"Manmohan Singh has to do more than offer ports, bridges and roads, as the Chinese do," pointed out Thant Myint-U, the author of "Where China Meets India: Burma and the New Crossroads of Asia."
"Instead he has to delve deeply into the very long history of cultural ties between the two countries and come up with a new vision for Indo-Burmese relations," he told Reuters.
India is Myanmar's third-biggest export market after Thailand and China and Myanmar's Ministry of Commerce expects two-way trade with India to double over the next two years.
In 2010, Indian trade with Myanmar stood at $1.2 billion, whereas Sino-Burmese trade was more than triple that figure. China also led the ranking in investments in Myanmar last year according to data from IHS Global Insight.
India also sees Myanmar as a springboard to closer ties with the Association of Southeast Asian Nations, as well as a key partner in counter-insurgency and economic development drives in its northeastern border region.
Before leaving Myanmar on Tuesday, Singh will meet pro-democracy icon Aung San Suu Kyi in the former capital Yangon.
Observers see this as a clear sign that New Delhi wants to refresh its relationship with the opposition leader whom the government supported fervently until the mid-1990s before forging closer ties with the Burmese junta and coming under international criticism.
act/gb (Reuters, AFP, PTI)