Crowds lined up the entire 45-kilometer route from Paro to the capital Thimphu, as PM Modi walked waving at them and blessing young children as a Bhutanese welcome song played in the background.
He exchanged smiles and greetings with the public and walked along with young children who had gathered with Indian flags to catch a glimpse of him.
Arriving in the Himalayan kingdom on a two-day state visit, PM Modi was received by his counterpart, Tshering Tobgay, with warm hugs and was also presented with a traditional Bhutanese scarf.
He was also accorded a Guard of Honour at the Paro Airport by the Bhutanese armed forces.
In a post on X on Friday, PM Modi thanked his counterpart Tobgay for a warm welcome. "Thank you for the warm welcome to Bhutan, PM @tsheringtobgay. May India-Bhutan friendship keep scaling new heights."
The visit, which was earlier postponed by a day due to weather conditions, is in keeping with the tradition of regular high-level exchanges between the countries, and India's emphasis on its Neighbourhood First policy.
During his stay, PM Modi will be inaugurating the Gyaltsuen Jetsun Pema Mother and Child Hospital, a state-of-the-art hospital in Thimphu, built with the assistance of the Government of India.
He will also receive an audience with Bhutan King Jigme Khesar Namgyel Wangchuck, Jigme Singye Wangchuck, the fourth King of Bhutan, and PM Tobgay.
Diplomatic relations between the two neighbours were established in 1968 with the establishment of a special office of India in Thimphu.