India prepared to hold funerals on Thursday for some of the 20 soldiers killed in brutal hand-to-hand fighting with Chinese troops in a disputed mountainous border region, as the two governments sought to de-escalate tensions.
Troops remained on alert at the Galwan Valley in the western Himalayas three days after the clashes, in which India said China had also suffered casualties.
Indian Foreign Minister Subrahmanyam Jaishankar spoke to top Chinese diplomat Wang Yi on Wednesday and the two sides agreed not to take any steps to escalate matters and instead ensure peace and stability on the contested frontier.
But both blamed each other for the deadliest border clash at since 1967 and said they must rein in their troops.
"The need of the hour was for Chinese side to reassess its action and take corrective action," the Indian foreign ministry quoted Jaishankar has telling Wang.
The Chinese diplomat said India must punish those responsible for the conflict and control its frontline troops, the Chinese foreign ministry said.
Rising tensions with China - whose economy is five times bigger than India's and has a better funded military - has become Prime Minister Narendra Modi's most serious foreign policy challenge since he took power in 2014.
The two nuclear-armed countries fought a brief border war in 1962 and have had occasional flare-ups when patrols have confronted each other at the poorly defined Line of Actual Control, or the de facto border.
But on Monday night, hundreds of soldiers fought with iron rods and clubs studded with nails in freezing heights for several hours.
Dozens of people lined the street in the southern town of Suryapet as the body of army colonel B.Santosh Babu wrapped in the Indian flag was brought home.
Funerals of other soldiers will also be taking place in their hometowns and villages, including several in the eastern state of Bihar.
"The sacrifice of our soldiers will not be allowed to go waste," Modi said.
Hardline nationalist groups tied to Modi's Bharatiya Janata party have stepped up calls for a boycott of Chinese goods and cancellation of contracts with Chinese firms.
"In the current situation, the China issue should not be taken lightly…In many cases, there may be Chinese money invested, but I think the regular things we buy from the market, one should certainly make sure that we avoid Chinese products," Food and Consumer Affairs minister Ram Vilas Paswan told the Economic Times.
India's financial markets have reacted nervously.
Both the NSE Nifty 50 index and the benchmark S&P BSE Sensex index swung between minor gains and losses as investors fretted over Indo-China tensions. The Nifty was last up 0.15% at 9,897.85 by 0528 GMT, while the Sensex was up 0.05% at 33,523.63.