At the G20 Retreat, ahead of the summit that kicks off later in the afternoon, Modi was flocked by Obama, Russian President Vladimir Putin and Australian Prime Minister Tony Abbott.
Abbott had thrown in a barbecue lunch for the retreat.
The Australian Prime Minister tweeted a photo of Modi sharing a lighter moment with Obama and himself during the retreat.
"The BBQ lunch with @narendramodi and @BarackObama was an opportunity for #G20 Leaders to talk in a relaxed atmosphere," Abbott posted.
Earlier, Abbott warmly welcomed Modi to the G20.
As they shook hands, Modi, attired in a black bandhgala suit, embraced the Australian premier.
The Age, which has been posting comments and photos of the event live, said of the Abbott-Modi hug:
"The stand out shake so far has been India's Prime Minister Modi, who gave Abbott a hug. An 'awww' could be heard across the media centre."
"There were no hugs from Abbott besties David Cameron and Stephen Harper. We repeat, no hugs," it said.
The Guardian, in an article on Modi titled 'Narendra Modi: from international pariah to the G20's political rock star', wrote that the Indian prime minister "is one of the most popular figures at this G20. A leader others want to see, and be seen with".