India and Pakistan have started a new round of talks focused on new confidence-building measures and their dispute over Kashmir. The two-day dialogue aims at infusing new momentum into the slow-moving peace process between the rivals.

India's Foreign Secretary Shyam Saran (l) and his Pakistani counterpart, Riaz Mohammad Khan

At the end of the first day of talks between Indian Foreign Secretary Shyam Saran and his Pakistani counterpart, Riaz Mohammad Khan, both sides sounded an upbeat note.

Indian Foreign Ministry spokesman Navtej Sarna said Tuesday they reviewed progress made so far in the two-year peace process, and the assessment was "positive."

"There are of course the overall improvement in relation between the two countries, building up of confidence and trust and reduction of what has been called the trust deficit, increased people-to-people contact and several confidence-building measures that have been put into place," said Sarna.

Sarna added that more people are traveling between the two countries, and there are positive trends in efforts to improve economic relations.

The two countries also discussed new measures to reduce the risk of accidents involving their nuclear weapons.

On Wednesday, the talks will focus on the more difficult issue of Kashmir, which is divided between them, but claimed by both. So far the rivals have made no substantial progress in tackling their core dispute over the Himalayan region, raising worries that the peace process is flagging.

Before the talks began, Pakistani President Pervez Musharraf blamed India in an interview for dragging its feet over finding a solution to the dispute. India in turn has expressed concern at what it sees as Islamabad's failure to stop attacks in Kashmir by Pakistani-based Islamic militants.

Bharat Karnad, a security analyst at the Center for Policy Research in New Delhi, says both countries have genuine concerns, but are aware that it will take time to tackle the issues that have bedeviled their relations for decades. He says the peace process is on track.

"They have gone into it with more realism," said Bharat Karnad. "By and large Pakistan is coming round to the long-held Indian view that people-to-people exchanges, things of that sort, the measures that will promote these kind of linkages would perhaps make for a better milieu in which the more difficult problems can be tackled. This is a consolidation of the composite dialogue that is happening now."

Both countries are exploring new confidence-building measures such as more transport links, and taking steps to reopen consulates in Karachi and Bombay.

In the two years since the peace process began, relations between the South Asian rivals have improved. Both countries have launched cross-border transport links and declared that peace between them is "irreversible."