Briefing reporters on Thursday on Trump's trip to France, the official said: "India's decision to rescind Article 370 in Kashmir is an internal decision, but certainly with regional implications. And President Trump will likely want to hear how Prime Minister Modi intends to calm regional tensions in light of this significant move."
"We do expect the issue of India-Pakistan relations to come up," the official added.
Trump has shown a faltering grasp of the Kashmir situation, reducing it to a religious issue and displaying an unawareness of India being a secular state with the world's third-largest population of Muslims.
Earlier this week he told reporters: "Kashmir's a very complicated place. You have the Hindus, and you have the Muslims, and I wouldn't say they get along so great. And that's what you have right now."
And last month he claimed that Trump that Modi had asked him to mediate or arbitrate on Kashmir when they met in Japan's Osaka in June.
India, which has always insisted that disputes with Pakistan are bilateral issues based on the 1972 Simla Declaration with no room for third party intervention, denied any such requests were made.
The State Department later conceded that the matter was a bilateral issue.
The Group of Seven(G7) industrialised democracies has invited India to its summit from August 24 to 26, in Biarritz, France.
The administration official said on Thursday that Trump will likely ask Modi about his plans "to uphold respect for human rights for Kashmir, as part of India's role as the world's largest democracy" and also express "his hope that India would lift the communications and movement restrictions in Kashmir and exercise the utmost restraint in dealing with potential protests".
The official also stressed that Trump wants Islamabad to end cross-border terrorism.
"Certainly, President Trump is also calling on Pakistan to prevent the infiltration of militants across the line of control that divides Kashmir and to crack down on groups on its territory that have attacked India in the past," the official said.
While staying away from any hint of mediation or arbitration that Trump spoken about, the official said: "The President is likely to stress the need for dialogue among all sides of the conflict."
Turning to bilateral issues, the official said on Thursday that Trump was expected to focus on strategic cooperation and trade, a favourite topic of the US leader.
Trump "is very much looking forward to his meeting" with Modi "where they will discuss the strategic partnership and how they can cooperate more closely on issues like defence cooperation, counterterrorism and trade," the official said.
"They will look for solutions on the trade front. The US is looking to India to reduce tariffs and open its markets," the official said.
The official recalled the Modi-Trump meeting in Osaka during the G20 meeting in June and said: "We expect the two leaders to build on the very productive discussions they had" and also on the phone call they had earlier this week.
(Arul Louis can be reached at arul.l@.in and followed on Twitter @arulouis)
( With inputs from IANS )