Prime Minister Narendra Modi and Chinese President Xi Jinping have agreed to undertake a joint India-China economic project in war-torn Afghanistan at their first informal summit, according to sources.

The understanding was reached between the two leaders during the two-day informal summit which concluded on Saturday, they reportedly said.

As per the understanding, officials of both sides will identify the project in follow up discussions and work out the modalities. This will be the first such project in the war-ravaged country by India and China, reported PTI.

China’s decision to team up with India in Afghanistan could upset Pakistan, which considers Beijing as its “all weather ally”, sources were quoted as saying.

China, while trying to expand its influence in Kabul, has tacitly backed Pakistan, which has been accused by Afghanistan and the US of backing the Taliban, media reports said.

They accuse Pakistan of proving safe havens to terror groups which carry out attacks in Afghanistan, destabilising any attempts to restore peace.

China for the first time held a trilateral meeting with the foreign ministers of Pakistan and Afghanistan in December last in Beijing to narrow down the differences between the two countries, the PTI report highlighted.

China had also reportedly announced plans to extend its controversial China-Pakistan Economic Corridor (CPEC) to Afghanistan at the meeting.