All eyes will now be on the planned visit of Indian Prime Minister Atal Behari Vajpayee to Islamabad for a key South Asian summit in early January.

In an interview less than three weeks before the summit, Musharraf said late on Wednesday he was prepared to be ?bold and flexible? in an attempt to resolve the perennial dispute over Kashmir.

?If we want to resolve this issue, both sides need to talk to each other with flexibility, coming beyond stated positions, meeting halfway somewhere,? he said. ?We are prepared to rise to the occasion, India has to be flexible also.?

For over 50 years, Islamabad has insisted on a plebiscite to allow people in the divided Himalayan region of Kashmir to decide between joining India or Pakistan, a position backed by a series of UN Security Council resolutions in the late 1940s. ?We are for United Nations Security Council Reso-lutions,? Pakistan?s military ruler said. ?However, now we have left that aside.?

New Delhi controls around 45 percent of Muslim-majority Kashmir, and insists it became an integral part of its territory after the princely state?s Hindu ruler opted to join India after partition of the subcontinent in 1947.

Former Indian foreign secretary J.N.Dixit said Musharraf?s offer marked an ?important shift in policy?. ?He is signifying there will be flexibility in the Pakistani negotiating position,? said Dixit, who has also served as India?s envoy to Islamabad. ?We should be able to respond with flexibility and see if we can find a middle ground.?

In Islamabad, Samina Ahmed of the International Crisis Group think tank said the Pakistani military realised it had to give ground if it was to retain any sympathy abroad. ?If they keep on insisting on a plebiscite, it is not going anywhere, and they are also losing ground to India internationally,? she said. ?In a way it is a realisation that if they keep on asking for everything they won?t get anything.? The neighbours have fought two of their three wars over Kashmir and went to the brink of a fourth conflict in 2002 over the scenic but troubled state. Relations thawed this year and the two armies agreed to a ceasefire last month along the frontline in Kashmir.

Musharraf said this represented a ?very real opportunity? to make peace, but warned India not to throw away the chance by continuing to spurn offers for talks. ?The basis of everything, the basis of a reduction in militancy...is moving forward on a process of dialogue,? he said. ?If that political dialogue doesn?t come about, who wins and who loses? It is the moderates who lose and the extremists who win, and that is exactly what has been happening.?

Musharraf refused to be drawn on how to settle the Kashmir dispute, but said any solution must be acceptable to Kashmiri people.

<B>Key summit</B>

Musharraf said Vajpayee should not miss the chance to discuss Kashmir during January?s summit, but said he would not be pleading for an audience with the Indian leader. ?We have come to a stage where there is a thaw in relations, where there is expectation on both sides in the people,? he said. ?If the leadership doesn?t rise to the occasion, it is a pity and I think we?ll disappoint our public again.?

But analysts warned against expecting too much from the summit, with progress always more difficult in the glare of a media spotlight. Instead, there are hopes the two sides might begin a lower-level dialogue sometime in February or March. ?It is essential to keep the avenues of communication open,? said Ahmed. ?It does not matter at what level, it has to be resumed.? But the path to peace looks a long and dangerous one.

Mistrust and outright hostility runs deep between the two rivals in South Asia, and Musharraf?s anger at his arch-foe often boiled over in the interview, as he railed against New Delhi?s intransigence and the ?arrogance of power?.

He also criticised India for taking advantage of the ceasefire to accelerate construction of a fence along the Line of Control dividing Kashmir, a move he said showed ?insincerity? about seeking a peaceful solution.

Commentators say there is no guarantee the ceasefire will hold through next spring when snows melt on the mountain passes and militants traditionally try to cross from Pakistan into Indian-held Kashmir.

With elections looming in India next year, New Delhi?s room for manoeuvre looks limited, analysts say. Musharraf, meanwhile, is fighting his own battle to win domestic political legitimacy four years after seizing power in a bloodless coup.

?Both sides have been using this issue for so long for domestic politics, to do a radical U-turn they would have to prepare public opinion,? Ahmed said. ?A road map is still a long, long way off.?

<B>?bomb jammer?

Security device saved Musharraf</B>

An electronic jamming device installed in the limousine of President Pervez Musharraf of Pakistan delayed a remote controlled explosion on a road bridge by seconds, allowing him to escape with his life, intelligence officials said on Thursday. The bomb was so sophisticated, involving remote control and timing devices, that it was believed to be the work of al-Qaida. The 250 kg bomb destroyed a road bridge on Sunday, less than a minute after Mr Musharraf?s motorcade had passed. The jammers work by emitting a magnetic impulse to block frequencies used to trigger explosive devices.

Simon Denyer