Colombo/New Delhi, Sep 2 (IANS): India Wednesday rejected reports that it was bringing Indian nationals to Sri Lanka for reconstruction work in the war-ravaged northern districts and underlined its determination to speed up the resettlement of the Tamil civilians in the island nation.

India's Foreign Secretary Nirupama Rao, who touched down in Colombo Monday on a three-day visit, called on President Mahinda Rajapaksa Wednesday at his Temple Trees residence.

She told Rajapaksa that India would expedite the projects undertaken by it, including the housing project for war-displaced Tamils and reconstruction of the railway line in the North.

Rao travelled to Mullaitivu and Trincomalee to interact with internally displaced persons (IDP) and assured them of India's unstinted determination in building 50,000 houses for them and to spur their rehabilitation.

Rao had visited Vavuniya, Kilinochchi and Jaffna Tuesday.

In Mullaitivu, the scene of the final stage of the encounter between the LTTE militants and the Lankan troops, Rao was informed by Government Agent (GA) N. Vethanayakam that 16,000 families have already been resettled in the area.

"He expressed deep appreciation for the assistance that had been received from the government of India for resettling IDPs," India's external affairs ministry said in a statement.

"She reiterated India's concern for the welfare of the people of this region and said that India would continue to work with the government of Sri Lanka to help resettle the people and rebuild their lives," the ministry said.

Rao rejected reports that India was bringing its own nationals to Sri Lanka for carrying out reconstruction work in the war-ravaged northern districts.

In Mullaitivu, Rao underlined that the rebuilding of houses would be done using local expertise and resources wherever available so that employment could be generated locally, the ministry said.

Rao stressed that "peace was necessary for development and that the need of the hour was to look forward and benefit from the tremendous potential that Sri Lanka had as a country to grow and prosper."

A report in Sri Lankan daily Sunday Times had claimed that India was transporting 20,000 workers to Sri Lanka to carry out reconstruction activities.

"We will not only build houses but also repair them. We want to participate in their recovery and progress," Rao said.

In Colombo, Rao called on Lankan President Mahinda Rajapaksa and told her of her visit to the Northern and Eastern provinces and India-aided projects for the benefit of the IDPs. Rajapaksa welcomed India's assistance, the ministry said.

Rao conveyed Indian Prime Minister Dr Manmohan Singh's good wishes to the president, a presidential release said in Colombo.

Rajapaksa stressed that Indian investors were showing an increasing interest in setting up business in Sri Lanka.

Rao also met leaders of major political parties, including UNP leader and Leader of the Opposition Ranil Wickremesinghe and leaders of the Tamil National Alliance and the Ceylon Workers' Congress.

Rao will hold meetings with delegations of other political parties before returning to India Thursday afternoon.

The Manmohan Singh government has sent Rao to Sri Lanka to assure the UPA's ally in Tamil Nadu that it was doing all it can to accelerate the process of resettling Tamil civilians displaced by the war between the Sri Lankan forces and the LTTE that ended in May last year.

Singh had announced Rs.500 crore aid for the relief and rehabilitation of the resettled population and pledged to build 50,000 houses for the displaced in the conflict-hit Northern Province.