New Delhi  - India and Turkey Friday decided to boost trade and energy cooperation and discussed ways to deal with global challenges like the deepening financial crisis and terrorism.

Turkish Prime Minister Recep Tayyip Erdogan held talks with his Indian counterpart Manmohan Singh in New Delhi after meeting with President Pratibha Patil and other Indian leaders.

"The discussions with Prime Minister Erdogan will contribute to the upgrading of our relations to a new level that befits the 21st century," Singh said after the talks, adding the two sides had chalked out a "concrete action programme".

India and Turkey set a trade target of 6 billion dollars to be reached by 2010 from the current level of 2.6 billion dollars. In this regard, a joint study group is to be established to examine the feasibility of entering a bilateral free trade pact.

The two countries also agreed on further collaboration in the area of energy, particularly hydrocarbons, as well as science and technology, culture and tourism.

"There was full agreement that terrorism poses a threat to our common values, and therefore needs to be tackled firmly and decisively through collective action. We have agreed to deepen our cooperation in the area of counter-terrorism," Singh added.

Singh and Erdogan also discussed regional issues such as the situation in Afghanistan and the ongoing global financial crisis.

The leaders said the crisis highlighted the urgent need for reform of international institutions.

Earlier on Friday, Erdogan participated in a business meeting organized by the Indian chamber of commerce where he suggested that businesses from both countries should invest more and create job opportunities.

"The poor nations are likely to bear the brunt of this crisis. Now is the time for making more investments and creating more jobs," he told business leaders.

"We need to effectively regulate our economy and not go for protectionist measures. We also need to rely upon regional cooperation," Erdogan added.

After his official engagements in New Delhi, the Turkish prime minister was due to visit the Taj Mahal in Agra and the country's information technology hub of Bangalore. He is scheduled to conclude his five-day visit on Monday. (dpa)