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LUCKNOW, India, Wednesday (AFP,Reuter) Indian Prime Minister Atal Behari Vajpayee said the people of troubled Kashmir state want to be part of India as was shown in the large turnout during elections held there last year.

"The Kashmiris want to be a part of India. The recent votes have been a proof of this where 40-45 percent voting had taken place. This attitude proved that the people were ready to take any risk but they wanted to exercise their right to franchise," Vajpayee said. The prime minister was addressing his Hindu nationalist BJP party workers in northern Lucknow town, which is also his parliamentary constituency.

Vajpayee said like most problems in the country, "terrorism" was also due to the high unemployment in Kashmir but expressed the hope that with highschool education being made free, the situation would improve.

"Unemployment and lack of education are the main reasons behind terrorism in Kashmir," he said.

Meanwhile President Pervez Musharraf told army commanders that he welcomed recent peace overtures between Pakistan and India, but declared he would never let their 55-year-old dispute over Kashmir be "sidelined". "Pakistan welcomes the recent thaw in relations with India," the state-run Associated Press of Pakistan quoted him as saying at military headquarters in Rawalpindi, next to Islamabad.

"Pakistan will never compromise on its honour and dignity or allow itself to be coerced ... Pakistan will never sideline the Kashmir issue," he added.

Musharraf said Pakistan stood for peace and wanted a peaceful resolution of all outstanding issues with India, including the "core" issue of Kashmir "through a meaningful dialogue based on sovereign equality". Meanwhile the prime minister of Pakistani Kashmir called for the partition of disputed Kashmir along religious lines as a way to resolve its standoff with India over the territory.

Sardar Sikandar Hayat Khan said Kashmir's Muslim-majority areas should go to Pakistan and Hindu areas accede to India.

"This solution is the closest to the 1947 partition plan under which India and Pakistan came into being," Khan told Reuters in a telephone interview.

The proposal from Khan comes as a surprise as his hardline All Jammu and Kashmir Muslim Conference party usually insists on Pakistani rule of the whole of Kashmir. Former Pakistan foreign minister Sartaj Aziz said the proposal had been put forward in the past. "There are many options which have been discussed at the unofficial level but the important thing is to start a dialogue," he told Reuters.

Irshad Mehmood, Kashmir analyst at the Islamabad-based Institute of Policy Studies, said it was a workable solution supported by some Hindu nationalists.

"It is a feasible formula on which talks can be held with India. But it can only work if the Kashmiris on both sides sit together to discuss it first," he added.

India holds about 45 percent of Kashmir, Pakistan over a third and China the remainder.

Khan said the division of mainly Muslim Himalayan region on religious lines would be "face saving" for Pakistan and India.

"If the Muslims of Kashmir are not prepared to live with India, how could Hindus agree to live with Pakistan?" Khan said.

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