Against the backdrop of the South China Sea issue row, Prime Minister Manmohan Singh today told his Chinese counterpart Wen Jiabao that India's oil exploration in the disputed maritime area is "purely commercial activity" even as the two sides agreed that there was enough space and areas for them to work together.

A range of issues, including the situation along the Line of Actual Control and trade was discussed during the 55-minute meeting with Singh saying India was committed to developing the "best of relations" with China while the latter underlined that the two countries should work "hand-in-hand" to ensure that the 21st century belongs to Asia.

"This matter did come up in the context of East Asia Summit (taking place here tomorrow)," Secretary (East) in the External Affairs Ministry Sanjay Singh told reporters when asked whether the issue of Chinese objections to India's exploration of oil in South China Sea figured in the talks between Singh and Wen.

The Prime Minister "observed that exploration of oil and gas in South China Sea by India is purely commercial activity", the Secretary said about the issue that has caused irritation in the ties between the two countries in the recent past.

The issue appears to have been raised by Wen.

External Affairs Ministry spokesman Vishnu Prakash told reporters that the Chinese Premier said that "he valued the role India is playing in the EAS. In that context, there was a mention of South China Sea to which the Prime Minister said our interests are purely commercial."

China, which lays claim over entire South China Sea, had openly attacked India in September over its move to explore oil in the maritime area on offer from Vietnam. It had evoked a sharp retort from India.

This was coupled with an incident in which an Indian Naval ship INS Airavat was threatened by the Chinese Navy while moving in that area.

In the context of China's claim over the entire South China Sea, Singh told Wen that "the issue of sovereignty should be resolved according to international law and practice".

India asserts that since it was not clearly defined that the maritime area belongs wholly to China, the laws of the sea will apply.

As the meeting began, Singh told Wen that "we are neighbours and also large growing economies of Asia. We should cooperate bilaterally and globally."

To press this point, Singh noted that whenever India and China had worked together on climate change, it has had a "positive impact" on the global stage.

Visualising "cooperative partnership" with China, Singh reminded Wen that he had said that "there is enough space in the world for both India and China to grow."

Adding on this point, Wen, who was meeting Singh here on the sidelines of the ASEAN and East Asia Summits, said: "there are enough areas in our world where India and China can enhance cooperation."

Recalling Wen's visit to India in December last year, Singh said it was a "milestone" in the bilateral relations during which the two sides discussed "new ideas and new approaches" to the relationship.

Referring to the oft-repeated contention that the 21st century should belong to Asia, the Chinese Premier said that for realisation of this goal, it is important for the two most populous countries of the world to "work hand-in-hand to forge ahead along the path of development. I have full confidence that the day of that kind of the world will arrive".

Singh, while noting that the two leaders had been meeting on the sidelines of all the ASEAN Summits held during the last six years, told Wen that he had "benefitted enormously" from his conversations with the Chinese leader on each occasion.

Earlier, expressing great pleasure in meeting Singh again, Wen said their decision to meet here to exchange views on major issues of mutual interest "shows how much importance leaders of both India and China attach to friendly relations and cooperation".