President Bush says the United States and Pakistan are allies in fighting terrorism and laying the foundation of lasting peace in the world.

At a banquet in Islamabad in his honor, Mr. Bush said once peace is won, the two partners will share it together.  He said Pakistan should take further steps in advancing democracy, education and social development.

President Musharraf said Pakistan is firmly on the path of economic growth and seeks US help in enhancing it.  He said Pakistan lies at the crossroads of South, West and Central Asia and has the potential of becoming the hub of economic activity.

He said the two countries share the common values of discouraging hate and extremism and promoting inter-faith harmony. 

General Musharraf also said the ongoing peace process with India is conducive to finding a solution of the decades-old Kashmir problem.