Prime Minister Narendra Modi on Saturday received a guard of honour at the Tashichhoedzong Palace.
At the palace, Modi is expected to meet King Jigme Khesar Namgyel Wangchuck. A traditional Chipdrel procession was hosted in the honour of the visiting dignitary.
"Traditional Chipdrel procession and welcome ceremony at the Tashichhodzong Palace for PM @narendramodi before the audience with His Majesty the King of Bhutan. The ceremony symbolises the purification of path along which the guests are led," MEA spokesperson Raveesh Kumar tweeted.
The Prime Minister is on a two-day visit to Bhutan. This is Modi's second visit to the Himalayan nation and first since his re-election as Prime Minister.
Modi arrived at the Paro International Airport earlier in the day and was received by his Bhutanese counterpart Lotay Tshering.
Hundreds of school children, waving the Indian and Bhutanese flags, lined the streets to welcome Modi.
The children in their traditional Bhutanese dress stood in rows along the streets as the Prime Minister made his way from Paro to Thimphu in the motorcade.
Modi was also greeted by the Indian diaspora at hotel Taj Tashi in Thimphu.
The Prime Minister's visit exemplifies the importance India attaches to its neighbourhood first policy.
Both countries are expected to sign 10 MoUs, in fields like education amongst others during the ongoing visit. Meetings are scheduled to be held at the Gyalyong Tshokhang, following which the MoUs will be inked.
Modi is also slated to meet the fourth king of Bhutan, Jigme Singye Wangchuk, later today.
A banquet will also be hosted in honour of the Prime Minister.
( With inputs from ANI )