The leaders of India and Burma have pledged to strengthen economic ties and take their countries' friendship to a new level.

During Friday's talks in New Delhi, Burmese President Thein Sein and Indian Prime Minister Manmohan Singh agreed to increase cooperation in oil and gas exploration.

The Burmese leader said he would encourage more Indian investment in his country's energy sector and Prime Minister Singh offered Burma a $500 million line of credit for infrastructure projects.

India, with a 1,600 kilometer-long border with Burma, has been forging close ties with its eastern neighbor for over a decade.

President Thein Sein's visit coincided with Burma's release this week of nearly 200 political prisoners, in another step to implement political reform after decades of military rule.

The Burmese military handed power in March to an elected civilian government. But critics say the new government is dominated by retired army officials.

Western nations, which have imposed decades of sanctions on Burma, have voiced cautious optimism.

India's prime minister has welcomed Burma's reform efforts and offered to share India's experience with parliamentary democracy in order to help Burma with its democratic transition.