Indian Prime Minister Narendra Modi landed in Bhutan on Friday for a two-day state visit to the tiny but strategic Himalayan nation also being courted by China.

Landlocked Bhutan, known for its policy of prioritising “Gross National Happiness” over growth, has long been regarded by New Delhi as a buffer state firmly within its orbit.

India is determined not to let China gain further toeholds across what it sees as its natural sphere of influence, following trade and infrastructure deals Beijing sealed over the years with other neighbours.

“The visit is in keeping with the tradition of regular high-level exchanges between India and Bhutan and the Government’s emphasis on its Neighbourhood First Policy,” said a statement from Modi’s office announcing his arrival.

India effectively oversaw Bhutan’s foreign policy until 2007, the year before the kingdom’s first multi-party elections.

Bhutan does not have formal diplomatic relations with China but the two countries inked a “cooperation agreement” last October after talks over their long-disputed frontier.

A December report from Britain’s Chatham House think tank included satellite photographs it said showed an “unsanctioned programme of settlement construction” by China in Bhutan’s northern frontier region.

It added that the developments could “become permanent Chinese territory” if a border deal was struck.

Modi last week hosted Bhutanese Prime Minister Tshering Tobgay in his first official overseas visit after returning to office for a second term in January.