Making an intervention during a G20 Leaders Summit session, Obama said the Modi government's ambitious plans for scaling up the use of renewable energy combines a concern for environment and creates opportunity for furthering global growth through fresh investment in renewable energy.
Obama also said it has the potential to create employment, according to a senior official present during his intervention.
The official said that the US President hailed India's economic growth under Modi's leadership.
In his intervention, Modi said there is global consensus on the need to address climate change.
"Stable long term global economic growth requires not just capital flows, but also efforts to facilitate labour mobility and skill portability," he said.
Modi further said India's economic growth is likely to grow at 7.5 per cent this year and achieve a growth rate of 8 per cent plus next year.
"Our programmes of inclusive development, including financial inclusion, universal access to basic needs by target year, Make in India, Skill India, Digital India, Industrial Corridors and Smart Cities will boost growth and, employment in India.
"This will be a source of strength for the global economy," he added.
In an earlier intervention, Modi said through bold economic and governance reforms, India has achieved a growth rate of nearly 7.5 per cent with strong prospects for a higher growth rate in the near future.
"We in India don't see development and climate change as competing objectives. This is centered on the belief in the unity of humanity and Nature. We have ambitious plans for addressing the challenges of climate change. This includes additional capacity of 175 GW of renewable energy by 2022, cut in subsidies on fossil fuel and tax on coal; and, National Clean Energy Fund of $3 billion to promote clean technologies," he added.