He said good neighbourly relations would help China's own development and the goals of achieving a prosperous and modern country by 2049, set by the 18th Communist Party National Congress last year.
In a major policy speech, Xi said dealings with neighbouring countries "should have a three-dimensional, multi-element perspective, beyond time and space".
Xi was addressing a conference on "Diplomatic work on neighbouring countries" here on Oct 24 and 25 which all members of the standing committee of the party's central committee's political bureau attended.
The speech followed talks with Indian prime minister Manmohan Singh and signing of a deal on maintaining peace and tranquility on the disputed border.
He said the neighbouring region has major "strategic significance" and "We should seek common ground and converging interests".
"We must strive to make our neighbours more friendly in politics, economically more closely tied to us, and we must have deeper security cooperation and closer people-to-people ties."
In diplomacy, he said, one must understand the "trend of the time, devise strategy and plan carefully."
"The situation requires us to keep pace with the times and be more active in blueprinting diplomatic strategy and undertaking diplomatic work," the official Xinhua news agency quoted him as saying.
Reviewing relations with neighbours, Xi said, the region has advantages and potential in development. "Our economic and trade links are closer, with unprecedented interactive exchanges."
Great efforts must be made towards win-win reciprocity, accurately identifying convergence points for cooperation, making use of China's advantages in economy, trade, technology and finance and actively taking part in regional economic cooperation, Xi said.
He said China should work with its neighbours to hasten inter-connectivity and establish a Silk Road economic belt and a maritime silk road for the 21st century.
China should accelerate establishment of free trade zones, with neighbours as the foundation stone, expand trade and investment and create a new pattern of regional economic integration.
He said China should accelerate the opening up of its border areas and deepening reciprocal cooperation with border areas of neighbouring countries.
Turning to the Asia-Pacific, Xi said that countries in the region must promote regional cooperation in an open mind and with greater enthusiasm.
He said China should continuously expand regional financial cooperation by playing an active role in establishing an Asian investment bank for infrastructure construction and improving the regional financial safety network.
He told the party leaders among whom was Prime Minister Li Keqiang that the path of peaceful development is the "party's strategic choice" and they must make great efforts to safeguard peace and stability in the region.
"A major purpose of this diplomacy is peace and stability in the region."
Xi said efforts shall be made to promote regional security cooperation.
A new outlook on security, featuring mutual trust, reciprocity, equality and coordination should be adhered to, Xi said, reiterating China's push for comprehensive, common and cooperative security.
Xi also called for public diplomacy and people-to-people exchanges between China and neighbours for the long term development of relationships.
People-to-people exchange should involve tourism, technology, education and sub-national cooperation, among others, to make many different kinds of friends.
"We should clearly present our policies to the outside world, tell China's story in an acceptable way, speak out so that we are heard, and interpret the Chinese dream from the perspective of the aspiration of all people in all countries for a better life and regional prosperity, and let the sense of common destiny take root with our neighbors."
--IANS (Posted on 26-10-2013)