Chelsea have been trying to sign Modric from Tottenham this summer and the midfielder has set his heart on a switch to Stamford Bridge.
Spurs have nevertheless made it clear they have no intention of letting any of their star players leave and Modric has had to focus on getting ready for the start of the new season at White Hart Lane.
He linked up with his national team for a friendly against the Republic of Ireland on Wednesday and completed 90 minutes in a goalless draw.
Having worked with Modric at close quarters over the past couple of days, Croatia boss Bilic has no doubts about the 25-year-old's state of mind.
"Judging by his performance in training yesterday and his mixing in the squad and his performance today, he is totally focused on football and he can cope with this situation because he is strong in the head and it doesn't affect his game," Bilic told Sky Sports News after the match.
Asked if Modric would be able to keep his focus with Tottenham, Bilic added: "You should ask Luka about his future. We speak a lot but it is between us, definitely."
Source: Team Talk
Source: Team Talk