India's prime minister has welcomed the appointment of new counterpart in Pakistan and said that he was "confident" of strengthening ties between the two neighbours.

Law makers elected Raja Pervez Ashraf as the country's new prime minister Friday, seeking to end a political upheaval.

India chose to refrain from commenting on Pakistan's internal crisis, sparked by judges ousting ex-Prime Minister Yousaf Raza Gilani over contempt charges and demanding the arrest of the first candidate to be nominated as his successor.

On Friday, Indian Prime Minister Manmohan Singh congratulated his Pakistani counterpart.

"Our two countries will continue to make progress in their bilateral dialogue and build good neighbourly relations by strengthening their cooperation in all areas for the benefit of the peoples of both countries," he said.

Relations between India and Pakistan, which have fought three wars since the subcontinent was partitioned in 1947, have been plagued by border disputes, and accusations of Pakistani militant activity against India.

The neighbours are still at loggerheads on the divided Himalayan territory of Kashmir and no closer to a full peace deal, but are channelling their efforts into increasing trade in the hope that business can bring them together.

Last month, they also agreed to enhance cooperation on terrorism, human trafficking, narcotics, counterfeit currency and cyber crime. AFP