US senators questioned if India's development of a port in Iran for trade access led to violating international sanctions.
A State Department official assured them administration would closely observe the project.
"We are very clear with India with limitations on activities with respect to Iran," Nisha Desai Biswal, Assistant Secretary of State for South and Central Asian Affairs said.
"We have to go through details of the Chabahar announcement to see where it falls in that place," she told Senate Foreign Relations Committee.
On Monday, Prime Minister Narendra Modi pledged up to $500 million to develop Iranian port of Chabahar, to try to give India trade access to Afghanistan, Iran and Central Asia. The route is at present all but blocked by Pakistan.
US and Europe lifted sanctions last January under a pact with Iran to limit its nuclear programme but some restrictions to trade continue, tied to issues such as human rights and terrorism.
Biswal said she hoped India's relationship with Iran was mainly focused on economic and energy issues, and said the administration recognised India's need for a trade route.
"From the Indian perspective, Iran represents for India a gateway into Afghanistan and Central Asia," she said.
Biswal said she had not seen any signal of Indian engagement with Iran in areas like military cooperation, that might be of concern to the United States.
Modi is likely to visit US in Juneand will address a joint meeting of Congress, a rare honor.
Senator Ben Cardin, the committee's top Democrat, asked whether Biswal expected security cooperation agreements to be signed during that visit.
Biswal noted that India and US have already strengthened their security cooperation in numerous areas.
"We're looking at what more areas we can engage in to deepen ties further," she said.