A government spokesman ruled out a ceasefire to allow a retreat by what India refers to as infiltrators from Indian administered territory.

India has been reporting steady gains since it began its military operations against the infiltrators seven weeks ago.

Delhi says the infiltrators include Pakistani soldiers - an allegation denied by Islamabad.

Owen Bennett-Jones in Islamabad: "There is guarded optimism in Delhi"

Pakistan and the US agreed at a weekend meeting that "concrete steps will be taken" to restore the Line of Control between Indian and Pakistani forces in Kashmir.

Islamabad went on to say it would use its influence to try to persuade militant groups fighting Indian forces in Kashmir to withdraw.

Some groups have indicated they will listen to a formal request from the Pakistani Government. Others have rejected the idea outright.

Battlefield success disputed

South Asia Correspondent Mike Wooldridge: "India ... is prepared to fight for every peak"

As the Washington talks were taking place India announced it had captured the strategically important Tiger Hill peak, which overlooks the main road from the border area to Srinagar, Kashmir's summer capital.

The Pakistani military has disputed India's account of the battle and further fighting was reported in the area on Monday.

India says it is a mopping up operation and that the success of the Tiger Hill operation has allowed it to transfer some troops to another front in the Batalik area.

(Click here to see a map of the area)

Senior Indian Army commanders say several skirmishes have taken place in Batalik with the infiltrators.

Colonel Avtar Singh said the rugged terrain makes military advances difficult but added: "I hope this is the final push."

The Indian Army says it has also captured a second strategic peak in the Drass region and that air strikes are also continuing at Kaksar and Muntho Dhalo, where infiltrators are reported to be heavily armed.

Voices of dissent

Delhi Correspondent Daniel Lak: "Much depends on the coming days"

The joint statement made in Washington by President Bill Clinton and Pakistani Prime Minister Nawaz Sharif did not elaborate on what steps would be taken to restore the Kashmir Line of Control.

But Pakistani Foreign Minister Sartaj Aziz told the BBC that progress in resolving the Kashmir issue was needed to persuade the militants to withdraw.

"If the mujahideen, or the freedom fighters as we call them, are going to be persuaded to withdraw, they obviously would do so if the world is paying some attention to their concerns," he said.

Pakistani Foreign Minister Sartaj Aziz

In Pakistan, spokesmen for the militant groups say the United Jihad Council - an umbrella organisation for 14 Kashmiri militant groups - is the only body that might consider a withdrawal request from Pakistan.

But a spokesman for one group, the Lashkar-i-Taiba, has rejected the idea, saying it does not take orders from Pakistan.

Pakistan's People Party, the main opposition group, has called for a parliamentary debate on the Washington statement and the main Islamic opposition, Jamaat-e-Islami, has condemned the government's move.

Seeds of conflict

The US-Pakistan statement came after three hours of talks in Washington on the deepening crisis and warned that unless action is taken now the fighting could sow "the seeds of wider conflict".

It said that both Mr Sharif and Mr Clinton had agreed that the India-Pakistan negotiations, which began in Lahore last February, provided the best forum "for resolving all issues, including Kashmir".

"The president said he would take a personal interest in encouraging an expeditious resumption and intensification of those bilateral efforts once the sanctity of the Line of Control has been fully restored," the statement continued.

The US meeting followed several demands by Pakistan for international mediation on the Kashmir issue. Washington has made little secret of its increasing concern over the conflict and has asked both sides to exercise restraint.