At a White House news conference, with Indian Prime Minister Manmohan Singh at his side, Obama said the world's two largest democracies will work together to solidify a special relationship.
"The relationship between our two countries has never been stronger -- a reminder that it will be one of the defining partnerships of the 21st century,” Obama said. “We look forward to celebrating our partnership tonight as Michelle and I host the prime minister and Mrs. Kaur at the first state dinner of my presidency."
During much of the Cold War, India was aligned with the Soviet Union while its archenemy, neighboring Pakistan, sided with the United States. But during the presidency of George W. Bush, that began to change, and Obama said today that the change is permanent.
"We reaffirmed the importance of our relationship and decided on future steps to enhance our strategic partnership,” Singh said. “We have agreed to further intensify our trade, investment, and economic cooperation in a way that creates jobs and prosperity in both our two countries, and stimulates global economic recovery."
Obama also said his administration is committed to completing a bilateral agreement, reached under Bush in 2005, under which U.S. companies would be able to compete for up to $150 billion in contracts to build and equip India's civilian nuclear power program.
India has been largely kept out of the international nuclear market since it first tested a nuclear bomb in 1974, and has not signed the Nuclear Non-proliferation Treaty, known as the NPT.
Singh said he's grateful that Obama is continuing Bush's effort to bring India back into the world nuclear energy arena.
"We had a very constructive exchange of views on strategic issues. Our defense cooperation is progressing well,” Singh said. “We agreed on the early and full implementation of our civil nuclear cooperation agreement."
Rival Pakistan also has a nuclear bomb, and relations between it and India remain strained. But Obama said it's not the job of the United States to intrude into the two countries' peace process, which has often stalled.
Yet that doesn't mean that Washington must be idle on that front, Obama said.
"Obviously, there are historic conflicts between India and Pakistan. It is not the place of the United States to try to, from the outside, resolve all those conflicts,” Obama said. “On the other hand, we want to be encouraging of ways in which both India and Pakistan can feel secure and focus on the development of their own countries and their people."
Obama made a surprise statement during a brief question-and-answer session, indicating he'd finally made up his mind -- or was close to it -- on his strategy for Afghanistan. He has been considering whether to send up to 40,000 more combat troops to the country, though some aides reportedly have urged him to focus more on training Afghan forces.
The president has met with his so-called "war cabinet" -- including Vice President Joseph Biden, Defense Secretary Robert Gates, and Secretary of State Hillary Clinton -- on exactly how he plans to address the war, which began eight years ago.
When he was running for president last year, Obama accused the Bush administration of paying too little attention to the Afghan war, which Bush began in an effort to root out Al-Qaeda after the attacks on the United States on September 11, 2001.
Today Obama said it remains America's goal to ensure that Al-Qaeda can't have a safe haven in Afghanistan. The way to do that, he argued, is to ensure stability in Afghanistan.
"After eight years -- some of those years in which we did not have, I think, either the resources or the strategy to get the job done -- it is my intention to finish the job," he said.
Obama said the job of stabilizing Afghanistan will be up to the Afghans themselves. He is reportedly going to announce his strategy on the evening of December 1.