"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," the Quadrennial Defence Review (QDR) report released by US Defence Secretary Robert Gates said.
The report, which is released once in four years to shape policy of Pentagon for the next four years, noted that though US will retain its position as the most powerful actor, it must boost up cooperation with its key allies and partners to 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.
Acccording to the report, India will play the most influential role in global affairs as its economic power, cultural reach and political influence increases.
"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," 128-page QDR report said.
The report acknowledged India's military capabilities, strengthened by the acquisition of latest technologies.
"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."
Taking note on its growing military strength the report said that India will emerge as the key security provider.
"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," it said.
United States' growing concern over China's lack of transparency was also mentioned in the report.
"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 report said that Sino-US relationship must be base on multi-dimensional to enhance confidence and trust between the two countries.
"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," the report said.