WASHINGTON, Sept 8: US Secretary of State Colin Powell has said that the environment for positive discussions between India and Pakistan has greatly improved and that the two countries are also tackling the 'very difficult issue' of Kashmir.

Mr Powell made this observation on Tuesday evening while talking to reporters about the meeting this week between Indian and Pakistani foreign ministers in New Delhi. When a reporter reminded him that India insisted that Kashmir was one of the issues and not the core issue between the two countries, Mr Powell said: "Both parties know that it has to be dealt with and it is part of their agenda."

But he then added that "Kashmir is a very difficult issue" and "it will take time to resolve." Mr Powell spoke with Foreign Minister Khurshid Mehmood Kasuri and Indian Foreign Minister Natwar Singh last week before the two men met in New Delhi to discuss the issue that has plagued their relations for the last 57 years.

"And I was pleased to learn from both of them that they are entering into this dialogue in a positive way," said Mr Powell. Asked to explain what he discussed with the two ministers, he said: "Both ministers recognize that Kashmir is an issue among many issues that have to be dealt with between the two nations."

India and Pakistan concluded the first round of talks this week. Mr Kasuri stressed the Kashmir issue, proposing a separate mechanism to discuss the problem exclusively.

New Delhi rejected the Pakistani proposal. "I am pleased that they are actually talking to one another at this level and at many other levels," said Mr Powell. He noted that the environment for 'positive discussions' has improved greatly over the last one-and-a-half years.

Mr Powell said the meeting in New Delhi was the first between Indian and Pakistani ministers "in a fairly long period of time". "So let's take heart in the reality that they are discussing all issues between the two countries, of which Kashmir is one, and both have acknowledged that," he added.