The Logistics Exchange Memorandum of Agreement (LEMOA) was "in principal" agreed on during Carter's visit to India in April.
The two sides also discussed India's "Major Defence Partner" designation, which was announced during Prime Minister Narendra Modi's visit to Washington in June, and the Defence Technology and Trade Initiative (DTTI) between the two countries.
A joint statement issued by US Department of Defense after the the meeting said: "welcomed the signing of the bilateral logistics exchange memorandum of agreement (LEMOA), which will facilitate additional opportunities for practical engagement and exchange."
Talking about the LEMOA in a joint press conference, Carter said it will be a "very substantial enabler" for the two countries to work together.
"I want to make clear what it does is make possible and make easier operating together when we choose to. It doesn't by itself create those agreements," Carter said.
He added that decisions on operating together will be taken on case by case basis.
"When they do agree it makes all much more smoother," he said.
Parrikar also clarified the agreement will not involve in setting up bases.
"It does not have anything to do with setting up bases. It is for logistic support to each other... Like supply of fuel, supply of of any other things that are required for joint operation, humanitarian assistance and many other..." Parrikar said.
"The defence relationship between India and the US is based on the two countries' shared values and interests, and their abiding commitment to global peace and security," the joint statement said.
It said the two sides discussed "the wealth of progress in bilateral cooperation and the deepening strategic partnership between the US and India".
"The visit -- their sixth interaction to date -- demonstrates the importance both sides place on strengthening defence ties across many areas: from increased strategic and regional cooperation, to deepened military-to-military exchanges, to expanded collaboration on defence technology and innovation," the statement said.
Discussing the "Major Defense Partner" designation, the two sides agreed on the importance this framework will provide to facilitate innovative and advanced opportunities in defence technology and trade cooperation.
It added that the US has agreed to elevate defence trade and technology sharing with India to a level commensurate with its closest allies and partners.
Carter also welcomed India's membership in the Missile Technology Control Regime (MTCR) and reaffirmed US support for India's membership in the Nuclear Suppliers Group (NSG).
The two also noted the signing of an information exchange annex under the framework of the Aircraft Carrier Joint Working Group. Secretary Carter and Minister Parrikar also agreed to continue to their close consultation on "Make in India" proposals.
The two sides also discussed cooperation on capabilities to augment India's capacity for maritime domain awareness (MDA).
The US acknowledged India's "positive contributions" to regional security and stability, including in matters beyond the maritime space.
Carter and Parrikar announced their agreement to further consultations in this area, including through the next Maritime Security Dialogue, which will be held later this year.
They noted recent high level official exchanges including the visit to New Delhi of Gen. John Nicholson for consultations on Afghanistan, as well as by the Secretary of the US Navy and the Secretary of the US Air Force earlier this month.
