Taking note of India's "growing influence" in global affairs, the US has said the country will be a net provider of security in the Indian Ocean and beyond with the growth of its military capabilities.
"The distribution of global political, economic and military power is shifting and becoming more diffuse. The rise of China, the world's most populous country, and India, the world's largest democracy, will continue to reshape the international system," said the Quadrennial Defence Review (QDR) report released by US Defence Secretary Robert Gates.
The once-in-a-four year report, which shapes the policy of the Pentagon for the next four years, noted that while the US will remain the most powerful actor, it must increasingly cooperate with key allies and partners to build and sustain peace and security.
"Whether and how rising powers fully integrate into the global system will be among this century's defining questions, and are thus central to America's interests," it said.
As the economic power, cultural reach and political influence of India increase, it is assuming a more influential role in global affairs, the 128-page QDR report said.
"This growing influence, combined with democratic values it shares with the United States, an open political system, and a commitment to global stability, will present many opportunities for cooperation," it said.
"India's military capabilities are rapidly improving through increased defence acquisitions and they now include long-range maritime surveillance, maritime interdiction and patrolling, air interdiction and strategic airlift," the report noted.
"India has already established its worldwide military influence through counter piracy, peacekeeping, humanitarian assistance, and disaster relief efforts. As its military capabilities grow, India will contribute to Asia as a net provider of security in the Indian Ocean and beyond," report.
On the other hand, the report expressed concerns over the lack of Chinese transparency over its military development.
"The United States welcomes a strong, prosperous, and successful China that plays a greater global role. The United States welcomes the positive benefits that can accrue from greater cooperation.
"However, lack of transparency and the nature of China's military development and decision-making processes raise legitimate questions about its future conduct and intentions within Asia and beyond," it said.
The US' relationship with China must therefore be multi-dimensional and undergirded by a process of enhancing confidence and reducing mistrust in a manner that reinforces mutual interests, the report said.
"The United States and China should sustain open channels of communication to discuss disagreements in order to manage and ultimately reduce the risks of conflict that are inherent in any relationship as broad and complex as that shared by these two nations," it said.