Bangladesh and India have agreed to work closely on security, an issue that has strained relations in recent weeks.
Bilateral relations have been strained over the insurgency issue
The decision came after talks between the two countries' home secretaries in the Bangladeshi capital, Dhaka.
The ministers said talks had been cordial but in terms of concrete moves they said only that the two sides' security forces "may co-ordinate".
The countries did announce a visa deal that would ease transit for Indians crossing Bangladesh.
The home secretaries, India's Dhirendra Singh and Omar Farooq of Bangladesh, are the most senior civil servants in their countries' interior ministries.
At a news conference after their meeting in Dhaka they said they had agreed that they would share intelligence on drug trafficking.
The issue of militant action in both countries has long been a matter of contention.
India claims rebels such as the United Liberation Front of Assam have camps in Bangladesh.
About 10,000 people have been killed in the group's 25-year fight for independence.
Dhaka in turn has alleged that criminals and extremists wanted in Bangladesh are being given shelter in India.
The ministers agreed that more effective border security was needed to prevent illegal movements.
The countries also agreed to grant double-entry visas to each other's citizens.
That will enable people from north-eastern Indian states to cross Bangladesh on their way to the rest of the country.
India has long wanted to improve communications with the north-east, which is isolated and economically underdeveloped.