However, there was little sign of progress on one topic under discussion - water sharing.

A joint statement said they exchanged views, reviewed past negotiations and promised to meet again some time in the future.

The BBC's Mike Wooldridge reports on the areas of dispute

"Differences are still very much there, but we are working towards a solution," the head of the Indian delegation Z Hasan told a news conference.

India wants to build a dam across the Jhelum river, which flows through the disputed Kashmir region, to make it navigable in the dry season, but Pakistan says this would violate a treaty between them.

Glacial battlefield

The talks are due to last some six days, and one of the main items on the agenda is expected to be the confrontation on the Siachen glacier in the Himalayas - the world's highest battlefield.

M J Akbar of Asian Age: little hope of progress

The glacier, which cuts through the disputed state of Kashmir, has witnessed an increase in military activity in advance of the talks, although the Indian Defence Minister George Fernandez said this was unlikely to have an impact on the talks.

Pakistan's Kashmir concerns

A number of government ministers are taking part in the talks, which are also likely to cover trade, as well as concerns about drug trafficking and terrorism.

India says it wants the dialogue between the two countries to push ahead on a broad front.

Kashmir is a priority for Pakistan

But Pakistan has again said there can be no real progress or normalisation of relations as long as the dispute over Kashmir remains unresolved.

Pakistani Foreign Minister Sartaj Aziz has said Pakistan expects India to be more committed to the process of dialogue between the two countries.

Mr Aziz said India's primary objective in resuming talks with Pakistan was to deflect international pressure.

He said this would not lead to any settlement on the issue of Kashmir.

New bus service

Talks between senior foreign ministry officials last month yielded few signs of progress.

Despite the on-going tensions, there are proposals to launch a new regular bus service between Lahore and Delhi.