PM Modi, who ended the visit with a bear hug, said a permanent solution is only possible with dialogue. "We know it is not easy but we need to keep trying as a lot is at stake," he said, standing at Al Muqata'a, the Palestine National Authority headquarters in Ramallah, with President Abbas by his side.

President Abbas conferred his country's highest award, the "Grand Collar of the State of Palestine", on PM Modi in recognition of his contribution to enhancing relations between India and Palestine.

In his remarks, President Abbas said Palestine was relying on India's role and great standing on the international stage to facilitate the peace process with Israel. He said Palestine has always been ready to engage in negotiations to achieve freedom and independence in accordance with the two-state solution along the lines of 1967, provided that East Jerusalem is the Capital of the state of Palestine. PM Modi did not address this point in his remarks.

"This is a historic visit that will lead to stronger bilateral cooperation," PM Modi declared, shortly after landing in Palestine on his short, three-hour-long visit. "Friendship between India and Palestine has stood the test of time. The people of Palestine have shown remarkable courage in the face of several challenges," he said.

In Ramallah that serves as the de facto capital of Palestine, PM Modi headed straight to the memorial of former President Yasser Arafat who the Prime Minister later described as "one of the greatest world leaders". Accompanied by President Abbas, he also visited the Yasser Arafat Museum.

During his visit to Israel in July last year, PM Modi had traveled to Jerusalem as well just 20 km away from the Palestinian authority's headquarters in Ramallah where he stood on Saturday. But he had then steered clear of crossing the 700-km long security barrier edging the West Bank into Ramallah to make the point that his government would treat India's relations with the two countries as "mutually independent and exclusive".

PM Modi had taken a chopper from the Jordanian capital of Amman, where he had spent the night, to reach Ramallah on Saturday. In 2015, then President Pranab Mukherjee had flown to Israel and traveled by road to Ramallah. Mr Mukerjee had, after an overnight stay at the Palestinian city, started his visit to Israel.

It was with PM Modi's stand-alone visit to Israel last July that New Delhi ended this practice of dignitaries who visit Israel, also traveling to Palestine. "We have de-hyphenated our relations with Palestine and Israel and now we see them both as mutually independent and exclusive and as part of this policy the prime minister is undertaking this visit," B Bala Bhaskar, joint secretary in the foreign ministry, said.

The two sides also signed agreements worth $50 million including setting up of a super specialty hospital worth $30 million in Beit Sahur and construction of a centre for empowering women worth $5 million.