MELBOURNE - Australian police launched a major murder investigation Friday after a three-year-old Indian boy's body was found dumped by a Melbourne roadside, threatening to cast a fresh shadow over ties.

Victoria state premier John Brumby said he found the killing of Gurshan Singh, who was visiting from Punjab in northern India, "personally distressing" but urged people not to presume any motive.

"What has occurred is an unthinkable tragedy. It's deeply, deeply distressing," Brumby told reporters.

"There are no visible signs of the cause of death at this stage... but I think it's very important that no one jumps to conclusions," he added.

Singh disappeared from a suburban house at about 1:00 pm (0200 GMT) Thursday while his mother was taking a shower. His body was found about six hours later some 30 kilometres (20 miles) away, not far from the city's airport.

Detective Inspector Steve Clark said the parents were "particularly upset" and were seeing grief counsellors. The boy, whose mother was studying in Australia, had been in the country for about six weeks.

His death comes as Foreign Minister Stephen Smith seeks to smooth over relations with India, a major export market, after a series of alleged race attacks including the killing of an Indian student in Melbourne in January.

Smith, the latest in a series of top officials to visit India in recent months, met Prime Minister Manmohan Singh on Thursday and assured him "that the Australian government was taking the issue of Indian student safety seriously.

"Prime Minister Singh said he appreciated the Australian government's efforts to address this issue," the foreign minister said in a statement.

Smith had earlier acknowledged that some of the attacks, which prompted street protests last year, were "racist" following a series of denials by senior officials and police.

Brumby said state police were using "every possible resource" and their "best investigators" to track down whoever killed Singh, and appealed for witnesses.

Police experts are carrying out further forensic tests after an autopsy failed to reveal the cause of death.

Hundreds of Indian nationals, among some 100,000 studying in Australia, have been robbed and beaten over the past 18 months culminating in January's stabbing murder of Nitin Garg, 21, as he walked to work at a burger restaurant.

The attacks, which have prompted damning coverage in Indian media, have badly damaged Australia's image abroad and have also hit its 15 billion US dollar industry educating foreign students, mostly from Asian countries.

Australia has sought to repair ties with a charm offensive involving a series of diplomatic visits to India and by enlisting legendary cricketer Shane Warne to meet Indian students.

Last month, thousands of Australians visited Indian restaurants for a "Vindaloos Against Violence" campaign aimed at showing solidarity with the 450,000-strong community.