Prime Minister Narendra Modi on Monday said the peace accord between the government and NSCN-IM was an inspiration in "our troubled world" and noted that the Naga problem was a legacy of the British, which took a long time to resolve as "we did not understand each other".

Speaking at the signing of the "historic" accord, Modi said the event not only marked the "end of a problem, but the beginning of a new future".

"Today's agreement is a shining example of what we can achieve when we deal with each other in a spirit of equality and respect, trust and confidence; when we seek to understand concerns and try to address aspirations; when we leave the path of dispute and take the high road of dialogue. It is a lesson and an inspiration in our troubled world," Modi said.

He said the Naga political issue had lingered for six decades, "taking a huge toll on generations of our people".

The Prime Minister said connectivity between Nagaland and the rest of India had remained weak and "we have continued to look at each other through the prism of false perceptions and old prejudices".

"Unfortunately, the Naga problem has taken so long to resolve because we did not understand each other.

"It is a legacy of the British rule. The colonial rulers had, by design, kept the Nagas isolated and insulated. They propagated terrible myths about Nagas in the rest of the country," he said.

Modi said the colonial rulers deliberately suppressed the reality that the Nagas were an extremely evolved society.

"They also spread negative ideas about the rest of India amongst Naga people. This was part of the well known policy of divide and rule of the colonial rulers."

Modi said it was one of the tragedies of independent India that "we have lived with this legacy".

"There were not many like Mahatma Gandhi, who loved the Naga people and was sensitive to their sentiments... economic development and progress in Nagaland remained modest; and, durable peace was elusive," he said.

Modi said peace, security and economic transformation of the northeast were among the highest priorities of his government and was at the heart of his foreign policy.

Modi said he was deeply concerned about resolving the Naga issue and he personally kept in touch with the progress of the talks.

Modi thanked NSCN-IM leaders Isak Swu and T Muivah and other Naga leaders for their "wisdom and courage, for their efforts and cooperation" in reaching the agreement.

Modi said he had the deepest admiration for the Naga people for their extraordinary support to the peace efforts and was deeply impressed by the rich and diverse culture during his many visits to the state.

"I compliment the National Socialist Council of Nagaland for maintaining the ceasefire agreement for nearly two decades, with a sense of honour that defines the great Naga people."

Modi said Naga courage and commitment were legendary and they represent the highest levels of humanism.

"Their system of village administration and grassroots democracy should be an inspiration for the rest of the country.

"The respect for the infirm and elders, the status of women in society, sensitivity to Mother Nature, and the emphasis on social equality is a natural way of Naga life. These are values that should constitute the foundation of the society that we all seek."

Modi said leaders and people of Nagaland will not only build a bright future for the state but will also contribute to making the nation stronger and more inclusive.