LONDON Last month I had a private dinner in Kabul with Amrullah Saleh, who at that time was President Hamid Karzai's security chief. Saleh is a tough, burly and intimidating Tajik with a piercing, unblinking stare, who rose to prominence as a mujahideen protege of Ahmed Shah Massood, the legendary Lion of the Panjshir.

Under Massood, Saleh was one of the leaders of the anti-Taliban forces in Afghanistan before 9/11, and he brought these credentials to his job after the US conquest, hunting down and interrogating any Taliban he could find, with little regard for notions of human rights. The Taliban and their backers in Pakistan's intelligence service, the ISI, regarded him as their fiercest enemy - something he was enormously proud of - and at dinner he spoke at length of his frustration with the ineffectiveness of Karzai's government in taking the fight to the Taliban, and the degree to which the ISI was still managing to aid their pocket insurgents in Waziristan and Balochistan.

It is a measure of how little the west still understands the conflict in Afghanistan that news of Saleh's sacking last month merited so much less attention than last week's sacking of General Stanley McChrystal. McChrystal's departure reflects no important alteration in strategy, but the sacking of Saleh gave notice of a major and ominous change of direction by Karzai. As Bruce Riedel, Obama's Afpak adviser, said when the news broke “Karzai's decision to sack Saleh and [Hanif] Atmar [the head of the interior ministry] has worried me more than any other development, because it means that Karzai is already planning for a post-American Afghanistan.”

Since then the nature of Karzai's plans have become clearer it has emerged that the head of the ISI, Lieutenant General Ahmad Shuja Pasha, has secretly been visiting Karzai; on Monday General Kayani, the head of the Pakistani army, will arrive in Kabul, presumably to confirm whatever deal has been agreed. It seems the Pakistanis are encouraging an accommodation between Karzai and the ISI-sponsored jihadi network of Sirajuddin Haqqani, which would give over much of the Pashtun south to Haqqani but preserve Karzai in power in Kabul. The US has been party to none of this, and administration officials are apparently surprised and alarmed.

The problem remains that we continue to view the situation in Afghanistan through western eyes, as a battle by the US and Nato against Al Qaeda and the Taliban - an impression underlined by the speech on Thursday by William Hague, the UK's foreign secretary. But this has long ceased to be the main issue, and British troops are now caught up in a complex local and regional conflict that has completely changed the nature of the war. Internally, the war is viewed primarily as a Pashtun rebellion against a Tajik, Uzbek and Hazara-dominated regime, which has only a fig leaf of Pashtun window-dressing in the person of Karzai. For although Karzai is a Pashtun, under his watch Nato installed the Northern Alliance in Kabul and drove out of power Afghanistan's Pashtun majority.

In this way we unwittingly took sides in the Afghan civil war that began in the 1970s - siding with the north against the south, the town against the country, secularism against Islam, and the Tajiks against the Pashtuns. We installed a government and trained up an army that in many ways discriminated against the Pashtun majority, and whose top-down constitution allowed for little federalism or regional representation. No matter how much western liberals may dislike the Taliban, they are in many ways the authentic voice of rural Pashtun conservatism, whose wishes are ignored by the government in Kabul and who are largely excluded from power.

Externally the war has now turned, like Kashmir, into an Indo-Pak proxy war in which Nato is really a bit player. Under Karzai, India has established increasing political and economic influence in Afghanistan, opened four regional consulates and provided reconstruction assistance amounting to about $662m. The Pakistani military establishment, already terrified of India turning into a new economic superpower, has always believed it would be suicide to accept an Indian presence in what they regard as their strategic Afghan backyard, and is completely paranoid about the still small Indian presence, rather as the British used to feel about Russians in Afghanistan in the days of the Great Game.

According to Indian diplomatic sources there are still fewer than 3,600 Indians in Afghanistan, almost all of them businessmen and contract workers; there are only 10 Indian diplomatic officers as opposed to nearly 150 in the UK embassy. Yet the horror of being squeezed in an Indian nutcracker has led the ISI to risk its internal security and coherence - as well as Pakistan's relationship with its main strategic ally, the US - in order to keep the Taliban in play and its leadership under watch and ISI patronage in Quetta. Indeed the degree to which the ISI has been controlling the Afghan Taliban has only just emerged. A report by Matt Waldman of the Carr Centre for Human Rights at Harvard, based on interviews with 10 former Taliban commanders, documented how the ISI “orchestrates, sustains and strongly influences” the Taliban, and that the ISI are even “represented as participants or observers on the Taliban supreme leadership council, the Quetta Shura”.

Karzai's new deal with the Pakistanis, and his obvious intention to try to reach some accommodation with the Haqqani wing of the Taliban through Pakistan's mediation, therefore represents a major strategic victory for the Pakistani military and a serious diplomatic defeat for India - though it remains to be seen if the ISI really can deliver the Taliban, who yesterday were proclaiming their unwillingness to negotiate with Karzai. It also remains to be seen whether the Pakistani military can defend their own country from the jihadi Frankenstein's monster they have created.

This dangerous new situation does offer some opportunities. Until now India, relishing its ever-growing international status, has understandably and angrily resisted any linkage between an Afghan settlement and Indo-Pak peace, which would involve finding a final agreement on Kashmir. Yet the linkage is already there, and there are many clear benefits for India if it is prepared to accept ground realities and negotiate.

The stage is now open for a deal whereby India could agree to minimise its presence in Afghanistan - which it could accept as Pakistan's sphere of influence - in return for Pakistan withdrawing its longstanding sponsorship of the Kashmir jihad, which it could accept as India's domain. To satisfy Nato, an undertaking by Pakistan to drive Al Qaeda from the region would also need to be included.

Such a deal would certainly be difficult to sell domestically. There would be strong resistance by the many hawks in both India and Pakistan. Yet such an understanding would be the best and possibly only hope for a regional peace that might allow Afghans, Kashmiris, Pakistanis and Indians some chance of a stable future and to concentrate on the regional issues that really matter - feeding and educating the largest undernourished population in the world.

The truth is that a Nato diplomatic offensive aimed at selling this solution is likely to have a far more positive effect than any amount of counterproductive military surges and drone strikes. For in calming the dangerous paranoia of the Pakistan military lies the only realistic chance of regional peace - and the war is likely to continue until the ISI can be persuaded that its own jihadis are a far bigger threat to Pakistan than that posed by India, its South Asian big brother over its border.—Dawn/The Guardian News Service