The US believes that freedom of expression and political participation are universal values, Barack Obama told an audience of young Shanghai students today, in a townhall-style meeting streamed live on the White House website, broadcast on a local Shanghai television station and carried as text on a major Chinese portal.

The president tackled issues ranging from internet censorship and the US stance on arms sale to Taiwan to his Nobel Peace Prize, in his question-and-answer session with around 300 students – his sole meeting with the Chinese public during his three-day visit to the country.

But some expressed disappointment at the soft tone of many questions and said he should have addressed human rights violations in China more directly.

In brief opening remarks Obama repeated earlier assurances that America welcomed China's rise adding: "Because of our co-operation, the US and China are more prosperous and more secure."

But he went on to highlight differences between the two countries, telling his audience: "We do not seek to impose any system of government on any other nation.

"But we also don't believe that the principles that we stand for are unique to our nation."

"These freedoms of expression, and worship, of access to information and political participation – we believe they are universal rights. They should be available to all people, including ethnic and religious minorities, whether they are in the United States, China or any nation."

Asked about China's great internet firewall Obama described himself as "a big supporter of non-censorship" and said criticism enabled by freedom of expression in the US made him a better president.

The president, who arrived in Shanghai late last night to begin the Chinese leg of his four-nation tour, answered questions from internet users and called at random on questioners in the audience – handpicked by officials at universities in the area. Participants in such events are carefully briefed in advance on what they may ask.

China-watchers in the US have long encouraged their government to reach out to the Chinese public, as well as the country's leaders. But the lengthy negotiations required to arrange today's town hall meetings – and the compromises required – are testament to the difficulties of doing so.

At one stage US officials considered ditching the event because of disagreements over the number of attendees – they initially wanted 1,000 present – and whether it would be broadcast live or not.

Campaigners have pushed hard for the president to speak out publicly on human rights issues. Aides have already indicated that he will raise them in his meetings with Chinese leaders.

But Nicholas Bequelin, Asia researcher at Human Rights Watch, said Obama had missed an opportunity, framing such issues as a question of political culture rather than international legal norms.

"What's important is to put a degree of pressure on the Chinese government for its repressive practices," he said.

"You cannot do that without a degree of straight talk. That's not what happened at this meeting … What was needed was to include things relevant to what is happening in the country – as he did in Cairo, for example."

For the most part, the president focused on a message of collaboration and mutual respect. Many of the most sensitive issues mentioned in the thousands of questions posted ahead of the event – such as Tibet – did not emerge.

"There are very few global challenges that can be solved unless the US and China agree," he told a questioner, citing the need to make progress on climate change.

"Other countries around the world will be waiting for us … If they say 'The US and China are not serious about this', they will not be serious either.

That's the burden of leadership that both countries now carry."

Obama's acknowledgement yesterday that time had run out to secure a legally binding deal at Copenhagen and backed plans to postpone a formal agreement until next year at earliest. But aides hope that the world's two largest emitters can move closer on the way forward.

Obama is now on his way to Beijing for two days of talks with Hu and premier Wen Jiabao, which will also address North Korea and Iran's nuclear programmes and the future of Afghanistan and Pakistan. He will also visit the Forbidden City and Great Wall.

Mo Shaoping, one of China's best-known human rights lawyers, told the Financial Times that people "from the American side" had contacted him to see whether he would meet Obama and that he was subsequently questioned about the event by public security officers. The US embassy said it had no knowledge of such a meeting.

Dozens of dissidents and activists have been detained ahead of his arrival, as is common with major visits.