Modi congratulated Prayut on becoming prime minster of Thailand and said "am sure our relations will become stronger".
Prayut, who was Thailand's army chief, took over as prime minister in August, the first serving army officer to assume the top office in over 20 years.
Prayut told Modi that "I fully agree and admire the concept of Make in India. It can drive the economy. Thailand can apply it for its economy too", according to tweets posted by the Prime Minister's Office twitter handle @PMOIndia.
Both leaders also discussed tourism, especially their common Buddhist heritage.
Modi invited the Thai leader to India and told him that India is looking forward to welcoming him.
He told him that External Affairs Minister Sushma Swaraj would be going to Thailand to attend a Sanskrit Conference.
Modi also conveyed birthday greetings to Thai King Bhumibol Adulyadej, which falls Dec 5. "Please convey my birthday greetings to His Majesty. Pray for his long life," he told Prayut.
Earlier, Modi met the Malaysian Prime Minister Najib Tun Razak and invited Malaysian companies to make in India.
Modi will attend the 12th ASEAN-India Summit here Wednesday. He will also meet heads of state and government of several countries on the sidelines of multilateral events.