The Prime Minister also told the Time magazine in an interview that both countries had learnt from history since their 1962 war.
"Since nearly last three decades until this time that we have entered into the 21st century, there is by and large peace and tranquillity on the India-China border," he said.
"It is not a volatile border. Not a single bullet has been fired for over a quarter of a century now. This essentially goes to prove that both countries have learnt from history."
Modi admitted that a large part of the long Sino-Indian border was still disputed.
"Still, I think both countries have shown great maturity in the last couple of decades to ensure and commit to economic cooperation which has continued to grow over the last 20 to 30 years to a stage where we currently have an extensive trade, investment and project related engagement between the two countries.
"Given the current economic situation in the world, we are at a stage where we cooperate with China at the international stage but we also compete with China when it comes to commerce and trade."
Asked to comment on China's growing influence in the world, Modi said: "I firmly believe that there is not a single country in the world, whether its population is one million or much more, which would not want to increase its influence internationally.
"I think it is a very natural tendency for the nations to increase their influence in the international space, as they pursue their international relations with different countries.
"I firmly believe that with due regard to international rules and regulations, and with full respect for human values, I think with these two perspectives in mind each country has the right to increase its presence, its impact and influence internationally for the benefit of the global community."
Time magazine asked him if he would like a special message to Chinese President Xi Jinping ahead of his trip to Beijing this month.
"I firmly believe that the relationship between two countries, the India-China relationship as you are referring to, should be such that to communicate with each other there should really not be a need for us to go through a third entity," he said.
"That is the level of relationship that we currently have."