Addressing the media after taking charge of the troubled state, Sayeed said: "If Jammu and Kashmir has to prosper, the first pre-requisite for it is peace.
"I have made it clear to the prime minister that peace must be ushered in so that Jammu and Kashmir can develop and prosper," he said, referring to Narendra Modi, who witnesses the oath taking ceremony here.
Sayeed said the Modi government would need to address the need for a dialogue between India and Pakistan and added that it was the Kashmiri people who held the biggest stake in peace.
"When firing takes place at the borders, we have people who abandon homes and seek temporary shelter. That has to stop, and that can only happen by bringing in peace."
Sayeed was sworn in Sunday at the head of a coalition government of his Peoples Democratic Party and the Bharatiya Janata Party (BJP).
Sayeed praised former prime minister and now ailing BJP star Atal Bihari Vajpayee for his peace vision vis-a-vis Pakistan, saying he persisted with it although "guns were booming on the border".
He pointed out that Pakistan, the separatist Hurriyat leaders and the militants had not tried to disrupt the election in the state this time.
"Otherwise all of you know, it does not take much to disturb the atmosphere in the state," he said.
The chief minister said the people of Jammu and Kashmir had made a conscious decision to throw their lot with India.
As the only Muslim majority state in the country, Jammu and Kashmir showcased the eclectic, multi-religious and multi-cultural integrity of "a great country like India".
He said that instead of speaking about the past, "I prefer to pursue my agenda of peace and good governance".
Sayeed justified the over two-month delay in government formation in the state by saying that he was in no hurry.
"I told my colleagues that even if it takes three months to work out a mutually agreed common minimum programme (CMP with the BJP), I was in no hurry.
"The CMP is a carefully crafted document for peace and governance that envisages a long-term agenda for ushering in sustainable peace and development in all the three regions of the state," he said, referring to the Kashmir Valley and the Jammu and Ladakh regions.
Copies of the CMP - called "Agenda of the Alliance" - were released at the media conference.
Its highlights are: strengthen and widen the ambit of democracy through inclusive politics, to provide smart governance, to bring about self-sustaining and balanced development and to create conditions to facilitate the resolution of all issues of Jammu and Kashmir.
The CMP says the new government will work out a one-time settlement for refugees from Pakistani Kashmir who came to the state in 1947, 1965 and 1971.
On the contentious Armed Forces Special Powers Act (AFSPA), which gives sweeping powers to the armed forces, the CMP says the government will examine the need for de-notifying disturbed areas "which as a consequence will enable the union government to take a final view on AFSPA".