ISLAMABAD, Feb 18: Prime Minister Shaukat Aziz on Friday expressed the confidence that after reaching an agreement on the Muzaffarabad-Srinagar bus service, Pakistan and India would take more positive steps towards resolution of all outstanding issues.

Talking to newsmen at the Chaklala airport before embarking on a two-day visit to Saudi Arabia, the prime minister said that back-channel efforts which had been continuing for quite some time had led to the fulfilment of a long-standing demand of Kashmiris living on both sides of the line of control.

Mr Aziz said he had told Indian External Affairs Minister Natwar Singh that though the bus service was a substantive CBM, the real aim of the ongoing talks should be the resolution of the Kashmir dispute.

He said he had also made it clear to the Indian minister that Pakistan desired a solution which was in line with the wishes of Kashmir people. The prime minister said the two countries ought to make a substantive breakthrough for resolving the dispute.

About the Baglihar dam project, Mr Aziz said the matter had been taken up with the World Bank for appointment of neutral arbitrators. He said Pakistan also had reservations over the Kishanganga dam on Neelam River and he had raised the issue with Mr Singh.

The prime minister said that Pakistan wanted to have normal relations with India through people-to-people contacts, cultural exchanges and economic and trade relations.

He said reopening of the Khokhrapar-Monabao train link was also under consideration and for the purpose the rail track was being repaired as it was in a dilapidated condition.

Similarly, talks were continuing to finalize the opening of the Pakistan consulate in Mumbai and the Indian consulate in Karachi, he added. Mr Aziz said that during his meeting with Mr Singh, he had emphasized the need for taking immediate steps for normalization of relations between the two countries.

Pakistan wanted to expand its trade and economic relations with India. Responding to a question, he said that Pakistan was making efforts for the transformation of the OIC into a vibrant representative body having the ability to project Islam in its true spirit and image.

The prime minister said he had held detailed discussions with his Malaysian counterpart Dr Abdullah Ahmed Badawi about the OIC to make it a representative body of the Muslim world.

He said during his visit to the OIC headquarters in Jeddah he would submit proposals prepared by Pakistan for the restructuring, reactivation and transformation of the OIC into a strong and dynamic body which could play a role in projecting the real image of Islam and protecting the interests of Muslim ummah.

About his visit to Saudi Arabia, the prime minister said he would address an economic forum in Jeddah on Saturday and later leave for Riyadh for talks with King Fahd, Prince Abdullah and other Saudi leaders.

When asked to comment on press reports about use of official funds on Umra pilgrimages, Mr Aziz said that all official tours were not meant for Umra as he was taking a 16-member team on his current tour.

The prime minister said that Pakistan and Saudi Arabia had close and friendly relations and continued to keep contact periodically to discuss regional and international issues to evolve consensus. He said he would discuss with the Saudi leaders challenges faced by Muslim Ummah.