Under the pact with Washington, India will lift a veto on a global agreement on streamlining customs rules that is likely to add US$1 trillion to the world economy as well as 21 million jobs - 18 million of them in developing countries.
Modi, elected in May, had pulled the plug on the World Trade Organisation agreement four months ago because he objected to a related deal on food security.
Washington, which was the principal opponent of India's food scheme on the grounds that it distorted trade, hailed yesterday's deal. Trade Representative Michael Froman said it would "give new momentum to multilateral efforts at the WTO" and predicted the Trade Facilitation Agreement (TFA) struck by the WTO last year in Bali, Indonesia, would now win quick ratification.
Yet, at a conference call to brief reporters on the deal, Froman declined to answer questions on what concessions India had given in return.