NEW DELHI: Narendra Modi took the oath of office as India's 15th prime minister on Monday at the start of a new era hailed by Pakistan’s Prime Minister Nawaz Sharif as an opportunity to end decades of regional instability.

Ten days after winning the most powerful mandate for 30 years in a landslide election win, Modi signalled his bold intentions by reportedly cutting a swathe through the ranks of government with a radical cabinet revamp.

And as stock markets rose at the prospect of a pro-business leader taking the helm of the world's largest democracy, his Pakistani counterpart gave voice to a widespread sense of optimism.

“It is a great moment and a great opportunity,” said PM Sharif, who is a guest for the swearing-in of a man with an image of being a hardline Hindu nationalist.

“This is a chance to reach out to each other. Both governments have a strong mandate,” Sharif told India's NDTV network, according to a transcript provided by the Pakistan High Commission.

“Both countries should rid the region of instability and security that has plagued us for decades.”

Also read: Modi inauguration a ‘great opportunity’ for a new chapter: Sharif

After a decade of left-leaning Congress party rule, the 63-year-old Modi is expected to steer India firmly to the right in the next five years.

Modi, leader of the Bharatiya Janata Party (BJP), paid a visit to the memorial of India’s independence hero Mahatma Gandhi early Monday, before then stopping to meet Atal Bihari Vajpayee, his party’s only previous premier, who is confined to his home at the age of 89.

Modi’s new cabinet was expected to be announced ahead of his inauguration at an evening ceremony and Modi indicated in a statement that the number of ministries would be sharply reduced.

Reports said that Modi, son of a tea-stall owner, planned to slash 26 government positions. Close ally Arun Jaitley was widely tipped as finance minister and the BJP’s most senior woman leader, Sushma Swaraj, as foreign minister.

“Team Modi” would have 23 full-rank cabinet ministers, down from his predecessor Manmohan Singh’s 28, while the number of junior ministers would be pruned to 22, the reports said.

The BJP secured the first majority since 1984 at the election, trouncing the scandal-plagued Congress on a promise of reviving manufacturing and investment to create millions of jobs.

Modi’s pledge to overhaul the flagging economy won over voters, along with his rags-to-riches story and reputation as a clean and efficient chief minister of prosperous western Gujarat state.

Also read: Indian Hindu, Muslim mobs clash in Modi's heartland

During campaigning, opponents and critics said the 63-year-old leader would favour the Hindu majority at the expense of the country's 150 million Muslims and other religious minorities.

Many Muslims remain deeply suspicious of Modi, who is tainted by communal riots in Gujarat in 2002 that killed more than 1,000 people, mostly Muslims. He has denied he failed to stop the bloodshed and a court investigation found he had no case to answer.

Also read: Modi shares ‘emotional moments’ with Nawaz