Modi took office in May after sweeping to power on a huge popular vote and a pledge to invigorate India's tepid economy, whose more-than-billion-strong population promises a huge potential market.
"Prime Minister Abe has invited new Prime Minister Modi to visit Japan, and the two countries are making final adjustments for that," top government spokesman Yoshihide Suga told a press conference Friday in Tokyo.
"On May 19, when Prime Minister Modi was still a candidate for the premiership, Prime Minister Abe had a teleconference with him and invited him to Japan,...and we are arranging dates... for his visit," a foreign ministry official in charge of Indian affairs told AFP.
The comments came as Jiji Press reported that Modi will likely come to Tokyo as soon as this month, with the increasingly precarious security situation in Asia near the top of the agenda, alongside a possible deal on nuclear power technology.
If the visit is realised quickly, Japan would be the first foreign country for Modi to visit as prime minister, Jiji said.
India is a natural marketplace for Japan's huge infrastructure firms and has been the recipient of frequent development aid and loans.
Analysts point out that, as well as their economic interests, India and Japan are natural allies; both have spiky relationships and long-running territorial disputes with China, whose increasing military confidence is causing disquiet in Asia and beyond.
The United States, Japan's key ally, is also concerned about China's growing willingness to use its economic and military might, and would welcome a closer relationship between New Delhi and Tokyo, who geographically bookend Beijing.
US ties with India are sometimes strained, and there have been fears that a previous anti-Modi mood in Washington could hamper future friendship.However, it was reported this week that the Indian prime minister will meet President Barack Obama in the US capital in September.