No India, Pakistan progress at South Asian summit

DHAKA, Sunday (Reuters) - Old rivals India and Pakistan failed to make headway in a slow-moving peace process as talks on Saturday between the two prime ministers stuck to entrenched positions in their long-running dispute over Kashmir.

The discussions between India's Manmohan Singh and Pakistan's Shaukat Aziz, held on the sidelines of a South Asian regional summit in the Bangladeshi capital of Dhaka, were not expected to achieve any breakthrough.

But the apparent hesitation by both sides to discuss new proposals to boost the two-year peace process could indicate fresh mistrust between them.

"The (Indian) prime minister said in taking the peace process forward, it was important we not be deflected by the kind of terrorist incidents which continue to take place," Indian Foreign Secretary Shyam Saran told a news conference after the talks.

"Infiltration attempts continue, violence continues," he said referring to separatist incursions into Indian Kashmir from the Pakistani sector. "This has an impact on public opinion in India and that has an impact on us."

Pakistan has promised to cooperate in investigating the Delhi attacks but has asked for evidence of who was behind the blasts.

Pakistan's foreign ministry spokeswoman Tasnim Aslam said Singh had told Aziz that investigations into the blasts were still continuing, so there was no evidence yet to be shared.

Aslam said Aziz reaffirmed Pakistan's position that "progress on the core issue of Kashmir was absolutely necessary."

She said the Pakistani prime minister also linked developing free trade between the two to progress on Kashmir.