A joint statement issued on Sunday said Krishna and his Nepali counterpart, Sujata Koirala, had discussed a range of issues, including assistance to Nepali security agencies.
"The two ministers discussed security concerns of the respective countries and agreed terrorism and extremism were a threat to both countries," the 20-point joint statement said. "They agreed to cooperate to end this menace."
"The two ministers also discussed ways to enhance bilateral security cooperation to control cross border crimes such as smuggling of fake Indian currency, human trafficking and arms smuggling," the statement said.
Krishna said India was willing to provide all possible assistance requested by Nepal for its security agencies.
Security assistance has been a sensitive issue with Nepal's Maoists, who say it would violate a peace agreement that ended their decades-long insurgency.
However, the Nepali army and the defence minister have been pressing for weapons and logistics, saying they were needed to replace older equipment.
Krishna also expressed concerns over frequent strikes and shutdowns of factories.
"Krishna pointed out that concerns remain about the business environment in Nepal affecting Indian investment and joint ventures and requested these issues be addressed urgently and effectively," the statement said.
Nepal meanwhile assured New Delhi that its territory would not be allowed to be used to stage any activity against India.
Krishna's visit to Nepal came amid deepening divisions between Nepali political parties and rising tensions between the opposition Maoists and India.
Saturday, Krishna met Maoist leader Pushpa Kamal Dahal and told him the Maosists have a hand in cementing good relations between the two countries.
During his stay in Nepal, the Indian foreign minister also met Nepali President Ram Baran Yadav, Prime Minister Madhav Kumar Nepal and top Nepali political leaders.
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