New Delhi: India and Seychelles on Monday agreed to work together on a project to develop a naval base at the Assumption Island keeping each other's concerns in mind after talks between Prime Minister Narendra Modi and President Danny Faure.

India also announced a USD 100-million credit to Seychelles for augmenting its defence capabilities. "With this credit, Seychelles will be able to buy defence equipment to boost its maritime capacity," Prime Minister Modi said in his joint media statement with Faure.

On the project to develop a naval facility at the island, which would give India a strategic advantage in the Indian Ocean Region, Modi said, "We have agreed to work together on the Assumption Island project based on each other's rights."

The statement comes just days after the island nation announced that the joint project with India to develop a naval base at Assumption Island would not move forward. Lawmakers had argued that allowing India access to Assumption would amount to surrendering the territory.

Faure, in his remarks, said the Assumption Island project was discussed and the two countries equally engaged to work together bearing each other's interests.

The agreement was signed by the two countries during Modi's first visit to the Indian Ocean archipelago nation in 2015, allowing India to build naval facilities on Assumption Island. The opposition in Seychelles is opposed to the pact.

The Seychelles President is on his first bilateral visit to India at the invitation of President Ram Nath Kovind. He visited Ahmedabad and Goa before landing in Delhi.

Expressing the intention to continue the dialogue on the issue, Faure, said, "We have underscored our commitment to remain at the heart of joint initiatives and collective efforts to stimulate and facilitate cooperation in fields representing priorities on the sub-regional, regional and continental agendas," Faure said.

During Faure's visit, the two countries added six new agreements covering significant sectors of development including culture, cyber security, maritime safety and security cooperation, diplomacy and infrastructure development.

"We will benefit from a second line of credit that will help the infrastructure of our military (and) defence forces in Seychelles. Through a grant, we will build a new government house. We will also build a new police headquarters and a new building for the Attorney General's office," Faure said.

Modi said the Dornier aircraft India was proposing to give to Seychelles would be there before its National Day on June 29.