He travels to key neighbour Sri Lanka on Friday. His five-day three-nation visit comes amid China's moves to increase its footprint in the key region, through which a large chunk of the world trade, including in oil, passes.

Modi also strongly emphasised upon the close people-links between the two countries, by his visit to the Ganga Talao temple, where he offered oblations at the Shiva temple, his visit to the Aapravasi Ghat where the Indian indentured labourers had arrived 100 years ago, and his talk at a civic reception at the Mahatma Gandhi Institute.

He praised the contributions of the Indian-origin people who form 70 percent of the country's population.

In his speech at the National Assembly, Modi said the destinies of both nations were "linked by the currents of the Indian Ocean".

Addressing the National Parliament of Mauritius, Modi assured that both sides would work to avoid the "abuse" of the double taxation avoidance convention and that India will "do nothing to harm this vibrant sector of one of our closest strategic partners".

Both sides have been negotiating to amend the Indo-Mauritius tax treaty amid India's apprehensions that it was being misused to route unaccounted money and evade taxes through round-tripping.

Round-tripping is usually referred to routing of domestic investments through Mauritius to take advantage of the Double Taxation Avoidance Agreement (DTAA) between the two countries.

Mauritius is one of the top sources of foreign direct investments (FDI) into India.

Mauritius has always maintained that there has been no concrete evidence of any such misuse and that it has strict checks and balances in place. However, the uncertainties over the tax pact have adversely affected investment flows between the two nations.

On Wednesday, Modi held talks with his Mauritian counterpart Anerood Jugnauth and both sides inked five agreements, including one to tap the rich marine resources of this Indian Ocean island nation.

India also offered $500 million concessional Line of Credit to Mauritius for key infrastructure projects.

Among his numerous engagements on Thursday was the commissioning of the India-built patrol vessel, Coast Guard Ship Barracuda, the first such vessel to be exported by India. Modi and Jugnauth participated in the event.

Modi said the ship was a "symbol of our shared commitment to peace and security in Indian Ocean - our common maritime home".

He said the Indian Ocean Region "is at the top of our policy priorities" and India seeks "a future for the Indian Ocean that lives up to the name of SAGAR - Security and Growth for All in the Region".

He said that "the time has come for a strong grouping around the Indian Ocean. We will pursue this with new vigour in the years ahead" -- remarks that could cause concern in China that has been gradually building its influence in the Indian Ocean Region over the years.

In a tacit reference to China, he said: "We recognise that there are other nations around the world, with strong interests and stakes in the region. Our goal is to seek a climate of trust and transparency, respect for international maritime rules and norms by all countries, sensitivity to each other's interests, peaceful resolution of maritime issues, and increase in maritime cooperation."

He visited the Aapravasi Ghat, an immigration depot through which the Indian indentured labourers entered Mauritius. In the morning, he offered prayers at the Ganga Talao, a Hindu pilgrimage site in the country.

He also made a strong connect with the diaspora, by stressing on their India links.

Speaking at a civic reception at the Mahatma Gandhi Institute, Modi praised the contribution of Indian indentured labourers for taking Mauritius to new heights of development and progress by dint of their hard work.

In an address, amid loud cheering by the crowd and chants of "Modi, Modi", the prime minister said that when the world praises the development of Mauritius, the "credit comes to our (India's) account".

"The people who came here as indentured labourers, today they have taken the place to new heights through their labour and suffering, but the credit comes to our account, when people ask about the development in Mauritius, as all were from India," Modi said to loud clapping.

Referring to climate change, Modi said small islands were worried about climate change, of being drowned in rising oceans in the years to come.

He said island countries like Mauritius can give a message to the world on climate change.

In the evening, he attended the National Day celebrations. He also met opposition leader Paul Berenger.