China is willing to initiate talks on Free Trade Agreement with Nepal at an early date, Xi said.
He suggested that the two countries should work on traffic interconnectivity, infrastructure, hydropower development, modernisation of agriculture and science and technology.
The Chinese President yesterday met his Nepalese counterpart Ram Baran Yadav on the sidelines of Boao Forum for Asia in Hainan Province, state-run Xinhua news agency reported.
Though no specific projects were mentioned with Nepal, the two sides are planning to beef up the connectivity with rail and road links, amid concerns in India over China's growing influence in the Himalayan country.
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Early this month, China had increased its annual aid to Nepal to USD 128 million from USD 24 million.
Yadav was one of the 13 heads of states and government who took part in the annual conference at Boao town.
Xi hoped that Nepal would not allow any forces to use Nepal's territory to engage in anti-China separatist activities.
He said China will continue to support Nepal's effort in safeguarding independence, sovereignty and territorial integrity.
Yadav said Nepal would never allow its territory to be used by any anti-China activities.
Nepal called for strengthened cooperation between the South Asian Association of Regional Cooperation (SAARC) and China, in a bid to promote regional interconnectivity and economic development, he said.
Yadav also said Nepal supports China's initiatives of jointly build the Silk Road Economic Belt, 21st-Century Maritime Silk Road and the Asian Infrastructure Investment Bank.