The prime ministers of India and Australia have agreed to seek closer ties in trade and security, amid China's increasing presence in the Indo-Pacific region.

Narendra Modi and Anthony Albanese held talks in Sydney on Wednesday. The city's iconic Opera House was lit up in the colors of the Indian flag in honor of his visit.

The leaders agreed to finalize a comprehensive trade agreement later this year, aimed at further strengthening the two nations' economic partnership.

Australia has been seeking to diversify its export markets in the face of trade disputes with China over the past three years. India has been eyeing Australia as a source of more mining imports, including critical minerals.

On security, the leaders stressed the importance of working together with other members of the Quad framework to achieve regional stability. The Quad comprises India, Australia, Japan and the United States.

Quad leaders had been scheduled to meet in Sydney on Wednesday, but the US president had to deal with a domestic economic crisis. The talks were instead held on the sidelines of the weekend G7 summit.