The prime minister arrived here on Thursday night on the second leg of his three-day China trip from Xi’an.
After the official welcome, Modi and Li held restricted talks.
Both sides have begun delegation level talks after which the two sides are expected to announce the inking of several agreements, including trade and investment.
Li and Modi are scheduled to make media statements too.
Earlier in the day, the prime minister inspected a guard of honour at the Great Hall of People.
On Thursday, Modi held summit talks with Chinese President Xi Jinping during which the border issue, the trade imbalance and Chinese investments in Pakistan had figured.