India and Pakistan pledge talks

Vice-presidential hopeful Sarah Palin met Mr Zardari (pictured) and Mr Singh

The leaders of India and Pakistan have agreed to resume peace talks following months of strained relations between the two countries.

Pakistani President Asif Ali Zardari and Indian Prime Minister Manmohan Singh said they would organise the talks within three months.

The two men met in New York, on the fringes of the UN General Assembly.

They also said that trade across the Line of Control which divides disputed Kashmir would begin next month.

In a joint statement, the two men acknowledged "the peace process has been under strain in recent months".

"They agreed that violence, hostility and terrorism have no place in the vision they share of the bilateral relationship, and must be visibly and verifiably prevented," the statement went on.

Two trade routes across the de facto border in Kashmir will open on 21 October to help improve relations, the statement said.

The routes will operate respectively between Srinagar and Poonch in Indian-administered Kashmir, and Muzaffarabad and Rawalkot on the Pakistani-controlled side of the LoC.

A third route between Kargil and Skardu is also to be discussed.

At the moment a passenger bus service operates across the LoC twice a month. Trade over the de facto border was a major demand by Muslims during recent protests in Indian-administered Kashmir.

'Anti-terror' meeting

This was Mr Singh's first meeting with Mr Zardari, since the widower of Benazir Bhutto replaced Pervez Musharraf as Pakistan's president earlier this month.

The two leaders said they were directing their foreign secretaries to "schedule meetings of the fifth round of the composite dialogue in the next three months".

The so-called composite dialogue encompasses eight topics, including the economy, border disputes and terrorism, as well as Kashmir.

Although the nuclear rivals have made significant progress on a number of issues during the last four years of talks, they have made little headway on key issues such as Kashmir.

And relations have been tense since India accused "elements of Pakistan" of involvement in the July bombing of its embassy in the Afghan capital Kabul - allegations Pakistan denies.

The bombing would be discussed at a special meeting of a joint anti-terror mechanism being convened next month, the statement said.

Both leaders also held talks with the Republican Party's vice-presidential candidate Sarah Palin.