ISLAMABAD, Dec 28: The second round of Indo-Pakistan foreign secretary-level talks concluded here on Tuesday with a joint pledge to carry the peace process forward and explore other confidence-building measures (CBMs).

"Both sides discussed the issue of Jammu and Kashmir and agreed to carry forward the process in the light of the joint statement issued after the meeting between President Gen Pervez Musharraf and Prime Minister Dr Manmohan Singh in New York on Sept 24, 2004," said a joint statement issued at the end of the talks.

The two foreign secretaries, Riaz Khokhar and Shyam Saran, held separate press conferences at which they presented the joint statement and took questions from the media.

No tangible progress was made on the key issue of Kashmir despite claims of flexibility from both sides, but they agreed to build on areas of convergence to make life easier for people on both sides of the divide.

The joint statement said the talks were held in a frank, cordial and constructive atmosphere and while no specific decisions were taken, the two sides discussed and further narrowed their differences on the draft agreement on pre-notification of flight-testing of ballistic missiles, and agreed to early finalization of a joint agreement draft which remained incomplete at a previous meeting of officials/ experts. Mr Khokhar described the differences as minor.

Discussion on the other six subjects under the composite dialogue concerning Siachen, Wullar/ Tulbul navigation project, Sir Creek, terrorism and drug trafficking, economic and commercial cooperation and promotion of friendly exchanges in various fields would be held on mutually-agreed dates between April and June 2005.

On the issue of peace and security, including CBMs, the statement said the two foreign secretaries reviewed the progress so far made on nuclear and conventional CBMs. Building upon the existing contacts between the DGMOs, they agreed to promote regular contacts at local level at designated places and explore further CBMs along the international boundary and the LoC.

The two sides agreed that technical meetings, including the joint study groups on trade matters headed by commerce secretaries, experts-level talks on nuclear and conventional confidence-building measures and technical-level meeting on bus service between/through Amritsar and Lahore, meeting between the narcotics control authorities would be held between January and June 2005.

However, there was no mention of the proposed bus service between Srinagar and Muzzarfarbad. The Indian foreign secretary at his press talk said that India had proposed that divided Kashmiri families be allowed border meetings at five designated venues which would help remove hurdles in the way of introducing cross-border bus service.

The statement said that the foreign ministers and the prime ministers of the two countries would meet during the coming Saarc summit in January and the Indian external affairs minister would visit Islamabad in February.

Mr Khokhar said that Indian Prime Minister Dr Manmohan Singh had been invited to visit Pakistan in March by the Pakistani leadership and that the invitation had been conveyed through the Indian foreign secretary.

He said that "the most significant aspect of the current process of engagement between Pakistan and India is certainly the desire of both sides to maintain close contacts at high political levels," and added that Islamabad believed that such high-level political exchanges would help in removing impediments in carrying forward a fruitful and purposeful dialogue on the Jammu and Kashmir dispute.

The foreign secretary also reiterated the need to associate 'the true representatives' of the Kashmiri people with the dialogue process on the settlement of the disputed state and also the need to ease the repression and violent suppression of human rights of the Kashmiri people in the occupied state. Pakistan also believed that India's persistent claim that the entire Jammu and Kashmir was its territory was unhelpful in carrying forward the dialogue.

Mr Khokhar said he had asked India to arrange a final meeting in January between the officials concerned to sort out the issue arising from the construction of the Baglihar dam and warned that failure to address Pakistan's concern in this respect would compel it to refer the case to the World Bank as the guarantor of the Indus Water treaty to intervene in the issue.

On the humanitarian issue of civilian prisoners, an agreement was reached between the two sides on provision of immediate notification to respective high commissions through the respective foreign ministries of arrested nationals; provision of consular access to detainees within three months of their apprehension; immediate repatriation after completion of sentence and nationality verification; evolving a mechanism for early repatriation of inadvertent crossers without their sentencing and a similar mechanism for early release, without sentencing, of those under 16 apprehended by either side.

The foreign secretaries of the two countries would now meet in New Delhi to review the overall progress in the composite dialogue in July or August 2005

SENSE OF OPTIMISM: Mr Shyam Saran declared that he would leave for Delhi with a renewed spirit of optimism. "I go back with a sense of optimism that there is sincerity and commitment on both sides to take this process forward," he said at a news briefing at the Indian media centre at local hotel here.

Turning to highlights of the morning session, he said there was 'a full and substantive discussion' on Jammu and Kashmir and expressed satisfaction with the discussions between the two sides on peace and security.

"We put forward the position of India that there should not be any apprehension in the minds of our Pakistani interlocutors that there is any intention on the part of India to marginalize the issue of Jammu and Kashmir or to put it on the back burner."

He said: "In the discussions on Kashmir the effort has been to try and find some areas of convergence where the two sides can work together despite the fact that we have perhaps differences on certain key elements."

Mr Saran said he conveyed this sentiment to his counterpart, adding: "We believe that if we take this process of building on the convergences forward, we engage in a process rather than on an event, we would be able to in fact advance along the road of searching for a final settlement of the Jammu and Kashmir issue."

The Indian secretary underlined that despite difference of opinion on the issue of Jammu and Kashmir the two sides instead of reiterating their stated positions should try to find some common ground and build on it.

"We believe that we have in fact embarked on that process, we believe that we are making some progress in that respect. I think we need the support of the peoples of India and Pakistan in order to carry this process forward," he said.

Mr Saran said there had been a recognition that Kashmir was a very complex issue and that some time was required to deal with this but in the meantime efforts should be made to address the human aspects of the issue.

He said in this respect the Indian side put forward a specific proposal of possible family reunions or meeting among relatives at the LoC. He said after checking with the authorities concerned the Indian side had indicated five meeting points along the LoC for allowing family reunions on designated days for designated periods of time that could take place under joint security arrangements by both sides.

The five places identified are Mendhar, Poonch, Suchetgar, Uri and Tangdhar. When asked to identify points of flexibility that India brought to the negotiating table on Kashmir issue, he said: "I think virtually on every point there is flexibility on the Indian side, so I will not cherry-pick on what points of flexibility are."

He added: "In terms of our overall approach we are prepared to be pragmatic, we are prepared to be practical with a view to expanding the entire range of relations between India and Pakistan."

In reply to a follow-up question, he said: "We have agreed to try and promote cross-LoC and cross-international boundary contacts and I mentioned our willingness to look at possible meeting places along the LoC."

Mr Saran said India was also prepared to be flexible on the proposed Srinagar-Muzaffarabad bus service and adopt a practical approach. "So there is no lack of flexibility in terms of addressing the issue of Jammu and Kashmir," he asserted.

He refused to predict the outcome of the bus talks, saying that the matter was under discussion and both sides approached it with a view to an early operationalization, emphasizing that both needed to be flexible and practical in this respect.

In reply to a question, he said India had not received any options from Pakistan as such in terms of the final settlement of the Kashmir issue but there was a readiness on both sides to take this process forward. Responding to another question, he reiterated that the two countries were involved in a process and it would move step by step.

"Currently, what we are focusing attention on is to see how despite the differences which divide us, is it possible for us at the end of the day to make life easier for people on both sides of this divide which is the LoC or the divide which is the international boundary."

He repeated several times that 'a great deal of attention' is being focused on how to make life easier for people on both sides, a sentiment that was also articulated by Mr Khokhar at his news briefing later in the afternoon.

Mr Saran maintained that the Indian side was adopting 'a very people-centred approach' and mentioned that an important focus of the Indian discussion in some respects was on the humanitarian aspect.

He said India believed that greater interaction of people across the LoC and international border would itself promote a mutually-acceptable understanding on the issue of Jammu and Kashmir.

He said India's talk about confidence-building and greater interaction between the people of the two countries and building upon the obvious affinity which existed between the peoples of the two countries should not be seen as a distraction from dealing with the issue of Jammu and Kashmir.

"We believe this is integral to our quest for a mutually-acceptable settlement," he emphasized. When asked whether the attempt to make life easier for people on both sides of the LoC was an option for the solution of Kashmir issue or a process towards its final settlement, he said: "Obviously the goal for both sides is the final settlement, this is what we agreed upon in the Shimla agreement."

However, he pointed out that for moving towards that goal both sides had to be involved in a certain realistic, practical process and that was precisely what they were engaged in.

LOC FENCING: Responding to a question on LoC fencing by India, he said: "As far as the fencing along the LoC is concerned, it should be read as nothing more or nothing less as the duty of a government to protect the safety and security of its citizens."

While sharing 'important elements' of the joint statement issued at the conclusion of the talks, Mr Saran specifically highlighted the issue of cross-border terrorism.

"Firstly, for us India, and we believe for Pakistan as well, it is extremely important that we reflect the importance that is attached to the very solemn assurances which were conveyed by President Musharraf to the then Prime Minister Vajpayee concerning terrorism, that no territory under the control of Pakistan would be used for any terrorist activities against India."

Continuing on the subject, he said: "As far as India is concerned we believe that the phenomenon of terrorism is not only a threat to India, we believe it is also a threat to Pakistan and therefore we have a certain shared objective of confronting and defeating the forces of terrorism and we hope that in days to come we will join hands together to deal with this particular threat."

Making it clear that from India's perspective the issue of terrorism was extremely important, he underlined the need for Pakistan to do more on cross-border terrorism.

When an Indian journalist asked him if he was convinced that Pakistan was taking all possible steps to completely stop the cross-border terrorism, Mr Saran was quick to point to a reference in the latest joint statement to the 'solemn and categoric reassurance which was contained in the January 6, 2004, statement that no territory under the control of Pakistan would be utilized for any terrorism against India."

He then categorically stated: "We believe more needs to be done. I mentioned this yesterday and I would repeat it today. We believe that more needs to be done in this regard."

He reiterated some of the measures India had decided to take with regard to senior citizens and children, and India's willingness to look at the opening of universities and schools to students from Pakistan and opening up more opportunities for treatment of Pakistani children in Indian medical institutions.

MEETING WITH AZIZ: At the outset, Mr Saran said he started his day with a 'very friendly and cordial' meeting with Prime Minister Shaukat Aziz. He said his meeting with the prime minister was 'very positive' and he found him receptive to the promotion of economic and commercial relations between the two countries.

Mr Saran said apart from the importance of addressing the issue of Jammu and Kashmir, they talked about the importance of trade and economic relations between India and Pakistan.

In this context, he told journalists that Prime Minister Aziz had expressed his readiness to consider applications from Indian banks to set up their offices in Pakistan. He said India in turn would be willing to do the same.

Mr Saran said he conveyed to Mr Aziz India's readiness to seriously address apprehensions in Pakistan regarding trade imbalance and the absence of a level-playing field between the two countries as far as trade and economic relations were concerned.

The Indian foreign secretary said he also mentioned to Mr Aziz the very important need for addressing the infrastructure of trade and economic relations between the two countries.

He maintained that proximity to the Indian market was the 'great comparative advantage' which Pakistan had in terms of promoting economy and trade. He said: "I think Pakistan should begin to look at India as an economic and trade opportunity and there the relative proximity of Pakistan is perhaps a very important locational advantage."

However, he pointed out that this locational advantage could be leveraged only if there was good infrastructure in terms of transport linkages. Mr Saran said he conveyed to the prime minister the Indian premier's 'very warm greetings and personal regards'.

He said the Indian prime minister had also asked him to convey to Mr Aziz that he looks forward to renewing their association when they meet in Dhaka on the sidelines of the forthcoming Saarc summit.