The stand-off on a plateau next to the mountainous Indian state of Sikkim, which borders China, has ratcheted up tension between the neighbours, who share a 3,500-km (2,175-mile) frontier, large parts of which are disputed.
"It has already been more than a month since the incident, and India is still not only illegally remaining on Chinese territory, it is also repairing roads in the rear, stocking up supplies, massing a large number of armed personnel," the foreign ministry said in a statement.
"This is certainly not for peace."
India has denied any such military buildup and, in a statement to parliament on Thursday evening, Foreign Minister Sushma Swaraj urged dialogue based on a written common understanding regarding the border intersection reached in 2012.
"India always believes that peace and tranquility in the India-China border is an important pre-requisite for smooth development of our bilateral relations," Swaraj said, according to a transcript of her remarks released by her office.
"We will continue to engage with the Chinese side through diplomatic channels to find a mutually acceptable solution."
Early in June, according to the Chinese interpretation of events, Indian guards crossed into China's Donglang region and obstructed work on a road on the plateau.
The two sides' troops then confronted each other close to a valley controlled by China that separates India from its close ally, Bhutan, and gives China access to the so-called Chicken's Neck, a thin strip of land connecting India and its remote northeastern regions.
India has said it warned China that construction of the road near their common border would have serious security implications.