As Prime Minister embarked on a three-day visit to Britain on Thursday, New Delhi and London signed a civil nuclear cooperation agreement after the two sides held delegation level talks here.
"The conclusion of the civil nuclear agreement is a symbol of our mutual trust and our resolve to combat climate change," Modi said while issuing a joint statement along with British Premier David Cameron.
"The agreement for cooperation in India's Global Centre for Clean Energy Partnerships will strengthen safety and security in the global nuclear industry," he said.
Modi said India attached great value to defence and security cooperation with Britain, including regular exercises and defence trade and collaboration.
"This cooperation will grow. I am also pleased that UK will participate in the International Fleet Review in India in February 2016. UK will also be a strong partner in India's defence modernization plans, including our 'Make in India' mission in defence sector," the Indian prime minister said.
He said the economic partnership between the two countries was quite robust "and a key pillar of our partnership".
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"I expressed confidence that this relationship grow rapidly in the years ahead, given the size and scale of opportunities in a rapidly expanding India and Britain's own formidable economic strengths," Modi said.
Stating that Britain was already the third largest investor in India, he said there was more investment from India in Britain than in rest of the European Union combined.
Modi expressed happiness with the progress in the cooperation between the two countries in clean energy and climate change, involving the governments and the private sector.
"This is an area of immense importance and enormous opportunities. Our bilateral cooperation will supplement India's comprehensive and ambitious national plan on climate change," he said.
According to the Indian prime minister, the partnership between the two countries includes peace and stability in Asia, especially in South Asia and West Asia, maritime security, cyber security, and terrorism and extremism.
He also thanked Cameron for the strong British support for India's permanent membership of the UN Security Council and membership in the international export control regimes.
On his part, Cameron said that as the oldest and largest democracies, India and Britain were natural partners.
He said Britain and India would build stronger economic, defence and global partnerships.
He expressed strong support from Britain for India's claim to permanent membership in the UN Security Council.
Modi also said that India would never tolerate intolerance. Asked about sectarian strife in India, he told the media that the Indian authorities will "take strict action against those who indulge in such (violent) acts".
"India will not tolerate intolerance," he said, adding that India was the land of Lord Buddha and Mahatma Gandhi.
"We are a democracy and committed to freedom of speech," he said. "We are not an intolerant society."
Without naming Pakistan, Modi said countries promoting terrorism must be isolated.
Terrorism was not a matter confronting just two or three countries, he said and noted that the scourge terrorism has spread so much today that it respects no borders.
Modi said humanity has to unite against terrorism and "those who promote terrorism should be isolated".
Prior to the official talks, the Indian prime minister was accorded a ceremonial guard of honour at the Treasury Quadrangle on King Charles Street here.
Modi also met members of the Sikh community in Britain before beginning his official engagements.
"The UK visit begins with a meeting with the Sikh community in London," the PMO India said in a tweet.
Modi was earlier received at Heathrow international airport, among others, by British Minister of State for the Foreign and Commonwealth Office Hugo Swire, British High Commissioner to India James David Evan, Indian High Commissioner to Britain Ranjan Mathai, and British Minister of State for Employment Priti Patel, who is of Indian origin.
Following the delegation level talks, he paid homage to Mahatma Gandhi at his statue at the Parliament Square here.
"Paying homage to the Mahatma. PM @narendramodi and PM @David_Cameron at the Gandhi statue," the Prime Minister's Office India tweeted after Modi laid floral tributes at the statue.
A fly-past by the Red Arrows, the aerobatics display team of the Royal Air Force, with the Indian colours marked the event.
In a historic first, Modi also addressed the British Parliament. Later, he would visit the Guildhall where he is scheduled to address the City of London.
The first day of Modi's visit was marred by protests staged by groups opposed to him. Pictures on Twitter showed people gathered at Downing Street, holding placards criticising Modi.
One picture showed a group of Sikhs holding black flags.