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Obama Asserts 'Limitless Potential' of US-Indian Relations

President Barack Obama and first lady Michelle Obama dance with students as they celebrate Diwali, a revered festival, during a visit to Holy Name High School in Mumbai, India, Sunday, Nov. 7, 2010. (AP Photo/Charles Dharapak)

US president speaks at a town hall-style meeting in Mumbai.

U.S. President Barack Obama says the relationship between India and the United States will be "indispensable" in shaping the 21st century.

Mr. Obama told students at a town hall-style meeting in Mumbai Sunday that a partnership between the two countries has "limitless potential" to improve the lives of Indians and Americans. He also said the relationship between the United States and India can serve as an anchor for security, prosperity and progress for Asia as a whole.

The president is in Mumbai on the second day of a 10-day Asia tour. He said the U.S. and India share many common values as the world's two largest democracies.

Mr. Obama is scheduled to meet later with Indian Prime Minister Manmohan Singh, and says the two leaders will announce a series of deals in areas ranging from counter-terrorism to climate change.

Mr. Obama also told students at Mumbai's St. Xavier College he believes India is no longer a rising power, but one that is taking its rightful place among world leaders.

As part of the town hall-style meeting, Mr. Obama took questions from some of the students on subjects including Pakistan and U.S. politics.

The U.S. president said India has the biggest stake in Pakistan's fight against extremists. He told students India does not need the distraction of security instability at a time when it is starting to see success on the global economic stage.

Mr. Obama also said the U.S. is engaging aggressively with the Pakistani government to combat an extremism that he described as a cancer. But he said while Pakistan understands the threat, progress is not coming as quickly as the U.S. would like.

Earlier Sunday, Mr. Obama danced with Indian students celebrating Diwali, the Hindu festival of lights.

He and first lady Michelle Obama are scheduled to travel to the Indian capital of New Delhi later Sunday. Once there they will take in some sightseeing at the tomb of Mughal Emperor Humayun before having a private dinner with Prime Minister Singh.

India is the first stop on the U.S. president's 10-day tour of Asia. His stay in India will be the longest time he has spent in a foreign country since taking office.

Mr. Obama will next visit Indonesia, where he lived during part of his childhood, then travel to South Korea for the summit of leaders of the world's 20 biggest economies.

The president is expected to raise the issue of China's tight control of its currency, which many lawmakers and business leaders say makes Chinese goods cheaper to sell on world markets. Mr. Obama is also hoping to announce progress on the long-stalled U.S.-South Korea free trade agreement.

President Obama will also visit Japan.

Some information for this report provided by AP, AFP and Reuters.