Indian PM: Kashmir vital to ties with Pakistan

NEW DELHI, Thursday (Reuters) - Indian Prime Minister Manmohan Singh said the issue of Kashmir was vital to better relations with nuclear rival Pakistan.

"We are committed to working with Pakistan to create an environment in which India and Pakistan can have the friendliest possible relations," he said in an annual media conference.

"I attach great importance to that object."

He said there had been movement in the two-year-old peace process between the South Asian neighbours.

While confidence building measures undertaken by the two countries have strengthened transport, cultural, sporting and commercial links since starting the peace process, they have made little headway on Kashmir, the cause of two of their three wars since independence from British rule in 1947.

"We have said we are committed to finding pragmatic, practical solutions to all outstanding issues between India and Pakistan including the issue of Jammu and Kashmir," Singh said, but added he did not have a mandate to negotiate the transfer of Indian territory.

Singh said he was ready to hold fresh talks with the main political separatist alliance, The All Parties Hurriyat (Freedom) Conference, to push for a peaceful resolution of a 15-year-old Muslim separatist revolt in Jammu and Kashmir, mainly Hindu India's only Muslim-majority state.

"Our doors are open to every shade of opinion." Singh said. He had held talks with Hurriyat leaders last September but the dialogue made little progress.

New Delhi had rejected proposals made by Pakistani President Pervez Musharraf last month to demilitarise three Indian Kashmir cities in an attempt to push talks over the disputed Himalayan region forward.

Earlier Singh said his government would last its full five-year-term despite differences with the ruling coalition's communist allies.

The leftists, who provide crucial support to the federal coalition with 61 MPs, have stepped up their attack on government policies in recent weeks, especially on the decision to handover the shabby airports at New Delhi and Mumbai to private firms for modernisation.

If the communists withdraw their outside support, Singh's minority government could fall.

The premier has highlighted India's robust economic performance with the economy growing at over seven percent, saying his coalition government was working well.

"We have our differences but at the end of the day, we have to take decisions on consensus. I have no fear of our government falling. Our government will surely last five years," Singh said at a televised news conference.

Singh's remarks came even as some left-backed unions stopped work at the country's three major international airports - New Delhi, Mumbai and Kolkata.

The protests turned violent when police used force to push back protesters in Mumbai, while flights were disrupted for several hours in Kolkata.

The unions, strongly supported by the communist parties, have threatened to continue their actions on Thursday.

On his relations with Sonia Gandhi, the powerful president of the Congress party and chief of the ruling United Progressive Alliance (UPA) coalition, Singh said there was no friction between the two leaders.

"Mrs Gandhi as ... chairperson of the UPA and I as PM have, I think, worked in a manner which has promoted harmonious function of the government and harmonious function of the coalition," he said in reply to a question.

"I think it has been a positive factor. Mrs Gandhi's guidance and advice has been an enormous source of strength for me and for our coalition's smooth functioning."