The five-hour talks between Chinese Vice Foreign Minister Wu Dawei and Indian Foreign Secretary Shyam Saran in New Delhi concluded with a statement that there was a "broad convergence" on regional and global issues discussed by the two sides.

Indian foreign ministry spokesman Navtej Sarna said the dialogue has helped increase mutual trust and understanding between the two Asian giants.

"The launching of this new dialogue mechanism between the two countries is significant in that it indicates their readiness to look at the bilateral relationship in a long-term and strategic manner," he said.

Talks between the India and China have so far mostly revolved around a border dispute that has lingered since they fought a brief war in 1962. But a steady improvement in ties in recent years has dispelled decades of suspicion and hostility.

Officials did not elaborate on the issues discussed. But observers said the talks focused on a range of issues such as the threat posed by terrorism and Islamic extremism in the region, the situation in Afghanistan and Iraq, and Iran's nuclear standoff with the West.

The two are also discussing ways in which they can exploit the energy resources of Central Asia. Their rapidly growing economies are among the world's largest consumers of oil, and both countries want to ensure their energy security in the coming years.

Sujit Dutta, a China expert at New Delhi's Institute for Defense Studies and Analysis, says the dialogue is a clear signal that the world's two most populous countries want to enhance cooperation as they seek to play a larger role in international affairs.

"It is a step toward stabilizing the relationship between India and China, which are the two emerging countries, both these countries are modernizing fast," he said. "It is necessary to stabilize that relationship. They are very large countries, they affect everyone else."

The talks helped to lay the groundwork for a visit by Chinese Prime Minister Wen Jiabao to India in March. Indian Foreign Ministry officials say that visit will mark a new phase in the relationship between the two countries.

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