Colombo: Prime Minister Narendra Modi on Saturday visited Jaffna, becoming the first Indian premier to set foot in the war-ravaged town in Sri Lanka`s Tamil-dominated Northern Province, where he handed over homes built with Indian assistance to displaced local Tamils.


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Modi also laid the foundation stone of a cultural centre in Jaffna. He is the second foreign leader to visit the town, about 400 km north of Colombo, after British Prime Minister David Cameron in November 2013.


He also visited the North Central Province`s capital city of Anuradhapura where he, along with Sri Lanka President Maithripala Sirisena, offered prayers at the sacred Mahabodhi tree.


After this, Modi flagged off a train service in the town of Talaimannar and also unveiled a plaque inaugurating the local railway station.


The Jaffna housing project, built with Indian assistance, will provide shelter to 27,000 families.


Speaking on the occasion, Modi said: "This project will provide shelter to 27,000 families. These houses are not just walls made of brick and stones, but an opportunity to share the sorrow of the needy and help them."


He said the owner-driven reconstruction project idea was begun in Gujarat after the 2001 earthquake.


Modi also participated in the symbolic milk boiling ceremony to mark house warming being performed by the families.


He also offered prayers at the the Naguleswaram Temple in Jaffna. "Feeling blessed", he tweeted.


At Talaimannar, he inaugurated the Talaimanar 1650 pier railway station and flagged off the Talaimannar- Medawachchiya train service to Colombo, following the rehabilitation work carried out with Indian credit assistance.


Speaking on the occasion, Modi said Sri Lanka and India ties are special. "We are not just neighbours but joined by our cultural relations."


He said the Talaimanar railway project would give a fillip to the economic progress of the area.


The railway line, which will stretch from the Talaimannar Pier to Madhu Road, covering a distance of 60 km, will provide connectivity for the people of Northern Province to the rest of the country.


Modi`s visit came a day after he gently nudged Sri Lanka to reach out to its Tamil minority and branded the the vanquished Tamil Tigers terrorists while he outlining his determination to build a stronger economic relationship with Colombo.


In a carefully worded speech delivered in parliament on Friday, Modi emphasized that Colombo, which crushed the Liberation Tigers of Tamil Eelam (LTTE) in May 2009, needed to respect all diversities -- for its own good.


Sri Lanka, he said to loud thumping of desks by the MPs, had successfully defeated terrorism and ended a long-running conflict that claimed thousands of lives since 1983.


"You now stand at a moment of historic opportunity to win the hearts and heal the wounds across all sections of society," he said, speaking in English to an audience of mostly Sinhalese politicians.


The prime minister is in Sri Lanka on the third and final leg of his five-day three-nation tour. He is the first Indian prime minister to visit Sri Lanka in 28 years. Earlier, he visited Mauritius and Seychelles.