India and Pakistan have agreed to resume air links that were suspended nearly two years ago. The decision is the latest sign of a thaw in relations, and was made ahead of a regional summit to be held in Pakistan in January.
The decision to resume two-way civilian air traffic starting on January 1 was announced hours after aviation officials from India and Pakistan met in the Indian capital, New Delhi.
A joint statement by the two sides called the talks "successful." It said both sides will resume direct air links, and also reopen their air space for flights to other countries.
The decision was widely expected. On Sunday, Pakistan President Pervez Musharraf removed the main obstacle to direct air links by offering to end a ban on Indian flights over his nation's territory. He called it a goodwill gesture, and said he hoped it would help resolve bilateral disputes.
India and Pakistan cut air and other transport links nearly two years ago, soon after a deadly attack on the Indian parliament in December 2001. The attack brought the two countries close to war, after New Delhi blamed it on Pakistan-backed Islamic militants, charges Islamabad denied.
The nuclear rivals began to mend ties in April. They have restored diplomatic relations and restarted a cross-border bus service. Last week, their armies began a cease-fire along the disputed Kashmir line of control, the first in 14 years.
In Pakistan, Foreign Ministry Spokesman Masood Khan called the planned resumption of air links a "significant watershed" in the peace process.
In New Delhi, political observers also hailed the decision. Independent political analyst Inder Malhotra said the air links and truce will accelerate the peace process. "All these are happy developments. The atmosphere is greatly changed. I hope both sides seize the opportunity," he said.
The direct flights are expected to resume days before Islamabad hosts a summit of South Asian countries. Indian Prime Minister Atal Behari Vajpayee is expected to attend, and the repaired links will allow him to fly directly to Pakistan. Over the past two years, businessmen and officials have either traveled via Dubai, or by a bus service operating across the border.
India and Pakistan have fought three wars, including two over Kashmir. The region is divided between them, and lies at the heart of their bitter relations.