Argentine and British bishops exchanged statuettes of the Virgin Mary in a powerful sign of reconciliation 37 years after the Falklands War between the two nations, in a ceremony on Wednesday led by Pope Francis.

Britain's Bishop of the Forces, Paul Mason, handed over a statuette of Our Lady of Lujan, Argentina's patron saint, to his Argentine counterpart, Santiago Olivera.

Argentine troops had abandoned the figure as they retreated from the Falkland Islands in 1982, and the British had taken it home with them, placing it in a cathedral in Aldershot, southern England.

In the swap, Bishop Olivera handed over a replica of the statuette to be taken back to the Catholic Military Cathedral of St Michael and St George in Aldershot, where prayers are offered for the fallen of both sides.

Francis -- who is Argentinian -- presided over the swap in the Vatican's Saint Peter's Square, then accepted a sip of mate, the country's traditional drink.

Britain's Bishop of the Forces Paul Mason, left, handed over a statuette of Our Lady of Lujan, Argentina's patron saint, to his Argentine counterpart, Santiago Olivera
Britain's Bishop of the Forces Paul Mason, left, handed over a statuette of Our Lady of Lujan, Argentina's patron saint, to his Argentine counterpart, Santiago Olivera AFP / Alberto PIZZOLI

The statuette is itself a copy of the 1630 original, which is in the Basilica of Lujan, a city near the Argentine capital Buenos Aires, the Catholic Church of England and Wales said in a statement ahead of the event.

"I immediately realised what a good opportunity it was, not only to return the statue, but also to demonstrate a united faith across two countries that have experienced political division," the Church quoted Mason as saying.

Argentinian troops occupied the Falklands in 1982 but were ousted by a British military task force after a brief war which cost the lives of more than 900 troops.

Britain rejects Argentina's requests for dialogue over the long-term future of the Falklands, which lie off South America in the South Atlantic, insisting there is nothing to discuss since 99.8 percent of the islanders voted in a 2013 referendum to remain a British overseas territory.

Argentina claims it inherited the remote islands, which it calls the Malvinas, when it gained independence from Spain. The stakes involved have increased in recent years with the discovery of significant exploitable oil and gas reserves around the islands.