Sri Lankan officials said S.M. Krishna travelled to the northern peninsula of Jaffna to open a diplomatic office in an area where Tamil Tigers ran a de facto separate state between 1990 and 1995.
A Sri Lankan official said it was the first time that India was setting up a diplomatic presence in the former war zone and comes as New Delhi seeks to counter Beijing's growing influence on the island.
The end to hostilities provides "a historic opportunity to address all outstanding issues of resettlement and a political settlement in a spirit of mutual accommodation", Krishna said on Friday before travelling to Jaffna.
Krishna, who held talks with Sri Lankan President Mahinda Rajapakse, said Colombo should address underlying political causes of the separatist campaign in the Sinhalese-majority nation.
New Delhi has been urging Sri Lanka to share political power with Tamils who share close cultural and religious links with the 62 million Tamils in the southern Indian state of Tamil Nadu.
India remained neutral in the final years of fighting, but the Sri Lankan government received military aid from Pakistan and China.
Aside from reaching out to the Tamil community, analysts have also seen India's heightened diplomatic presence in Sri Lanka through the new Jaffna consulate as well as another slated for the deep south as a bid to counter China's growing influence.Analysts have said New Delhi is concerned that a new port funded by Beijing is part of a Chinese policy to throw a geographical circle of influence around India.
However, Krishna on Friday played down concerns over China, which is building ports, highways and railroads in Sri Lanka. China has overtaken India and international institutions to become Sri Lanka's top lender this year.
China is also developing port facilities in Bangladesh, Myanmar and Pakistan, and has plans for rail projects in Nepal and Sri Lanka.