The Saudi crown prince Mohammed bin Salman began his South Asia tour from Pakistan and will commence on his two-day visit to India on Tuesday.
During his visit, India is likely to raise the issue of state-sponsored terrorism by Pakistan with the crown prince, as the two countries will look forward to enhancing defense ties, including having a joint naval exercise.
The sources said the two sides are looking at joint exercise between the two navies besides significantly ramping up overall defence cooperation.
Ahead of his visit, the Kingdom's Minister of State for Foreign Affairs Adel al-Jubeir said in Islamabad that Riyadh will try to "de-escalate" tensions between India and Pakistan in the wake of the cowardly Pulwama terror attack on jawaans perpetrated by Pakistan-backed Jaish-e-Mohammad.
Official sources said Saudi Arabia was no longer accepting Pakistan's narrative on Kashmir and cross border terrorism and that India will forcefully raise the issue of Pakistan's support to terror groups during delegation-level talks between Prime Minister Narendra Modi and the Crown Prince on Wednesday.
They said the joint statement to be issued after talks between the two sides is likely to have a strong reference about terrorism and ways to deal with it.
Referring to cross border terrorism, he said, "Saudi Arabia has strongly condemned and denounced the terrorist attack on Indian security forces in Pulwama on 14 February. We appreciate Kingdom's cooperation in security and counter-terrorism areas over the years."
According to reports, Saudi Arabia has been providing India with intelligence on terror networks and that Riyadh and New Delhi had inked a pact on the exchange of intelligence relating terrorism to money laundering during PM Modi's visit to the Kingdom in 2016.
The middle eastern country is likely to sign five agreements with India in the areas of- investment, tourism, housing, information and broadcast.
The Crown Prince will be accompanied by a high-level official team as well as a large business delegation. Modi will host a lunch in honour of the Crown Prince at Hyderabad House on Wednesday.
The two countries held a meeting of 4th Joint Defence Cooperation Committee last month in Riyadh during which both sides explored the possibility of elevating the defence engagement with joint production and joint exercises, particularly joint naval exercises, said Tirumurti.
India's bilateral trade with Saudi Arabia was USD 27.48 billion in 2017-18, making Saudi Arabia its 4th largest trading partner.
Saudi Arabia is also a key pillar of India's energy security, being a source of 17 per cent or more of crude oil and 32 per cent of LPG requirements of India.
Recently, Saudi ARAMCO in partnership with ADNOC of UAE has agreed to partner in Ratnagiri Refinery and Petro-Chemical project Ltd which is a joint venture of USD 44 billion.
Indian partners are IOC, BPCL and HPCL.
"We hope to transform this buyer-seller relationship in energy to a broad-based partnership," said Tirumurti.
He said other areas of interest for joint collaboration are fertilizers, food security, infrastructure, renewable energy, etc.
"We are also looking forward to greater collaboration in the area of civil aviation, where there is considerable potential for enhanced links, especially in the context of increasing trade, tourism and in enhancing the convenience of travel," the official said.
He said Saudi Arabia has conveyed to India that it will be joining the 'International Solar Alliance' initiative.
The Crown Prince is expected to travel to China from India after a huge diplomatic crisis following the murder of Washington Post journalist Jamal Khashoggi inside the Saudi consulate in Istanbul.
(With PTI inputs)