Obama justified the use of unmanned armed aircrafts, popularly known as drones, as "legal" a highly "effective" tool to target high value terrorist targets, indicating that his administration would continue to use it as a key asset in war against terrorism.
Speaking at the National Defense University here yesterday, Obama also reiterated his commitment to close down the terrorist detention center in Guantanamo Bay, arguing that this has become a symbol around the world that America flouts the rule of law.
Obama's major policy speech on counter-terrorism issues in his second term was disturbed by a protester calling for immediate closure of Guantanamo prison.
Obama asserted that United States respects the sovereignty of other countries, noting that a commando operation like the one that killed al-Qaeda leader Osama bin Laden cannot be a norm.
"Our operation in Pakistan against Osama bin Laden cannot be the norm. The risks in that case were immense. The likelihood of capture, although that was our preference, was remote, given the certainty that our folks would confront resistance," Obama said.
"The fact that we did not find ourselves confronted with civilian casualties or embroiled in a extended firefight was a testament to the meticulous planning and professionalism of our special forces, but it also depended on some luck. And it was supported by massive infrastructure in Afghanistan," he said.
Obama said that civilian casualties from drone strikes "haunt" him, but added that risk must be balanced against the threat from terrorist groups that are specifically targeting civilians.
"Doing nothing is not an option," he said.
"We are at war with an organisation that right now would kill as many Americans as they could if we did not stop them first," Obama said.
"So this is a just war - a war waged proportionally, in last resort, and in self-defence," he added.
In a sweeping speech, Obama also outlined new rules or overseas drone strikes and revamped efforts to close the prison at Guantanamo Bay.
Obama sought to reframe his counter-terrorism strategy saying that "America is at a crossroads."
"... As our fight enters a new phase, America's legitimate claim of self-defense cannot be the end of the discussion. To say a military tactic is legal, or even effective, is not to say it is wise or moral in every instance, for the same progress that gives us the technology to strike half a world away also demands the discipline to constrain that power, or risk abusing it," Obama said.
"That's why, over the last four years, my administration has worked vigorously to establish a framework that governs our use of force against terrorists -- insisting upon clear guidelines, oversight and accountability that is now codified in presidential policy guidance that I signed yesterday," he said.
The armed drone has become the signature weapon in America's "war on terror".
But their use raises a variety of complex legal and ethical issues, quite apart from practical arguments as to whether the drone strikes themselves are effective.
"In the Afghan war theater we must, and will continue to, support our troops until the transition is complete at the end of 2014. And that means we will continue to take strikes against high-value al- Qaeda targets, but also against forces that are massing to support attacks on coalition forces," said the US President.
Obama said beyond Afghanistan, the US only target al-Qaeda and its associated forces, and even then the use of drones is heavily constrained.
"America does not take strikes when we have the ability to capture individual terrorists. Our preference is always to detain, interrogate and prosecute them. America cannot take strikes wherever we choose," he said.
"We must define our effort not as a boundless 'global war on terror' - but rather as a series of persistent, targeted efforts to dismantle specific networks of violent extremists that threaten America. In many cases, this will involve partnerships with other countries."
On Guantanamo, Obama said he is lifting the moratorium on detainee transfers to Yemen that he imposed in 2010 after it was revealed that Detroit 'underwear bomber' Umar Farouq Abdulmuttalab was trained in Yemen.
He said he would appoint a new envoy at the State Department and an official at the Defence Department who will attempt to negotiate transfers of Guantanamo detainees to other countries.
And he said he is lifting the moratorium on some detainee transfers.
Obama had pledged to close the facility during his first year in office.
But his efforts ran afoul of congressional Republicans who opposed trials of terrorism suspects in the United States, and of other countries that refused to take some prisoners.
Some detainees at the prison, meanwhile, are in the midst of a hunger strike, protesting their conditions.
In his speech, Obama called on Congress to lift some of those restrictions, and to establish a facility in the United States for detention and military trials of some 'Gitmo' suspects.