Pakistan and India have agreed to resume official talks in February, in an effort to settle differences including the long-running dispute in Kashmir. The discussions are resuming after a gap of more than two years.

A groundbreaking meeting between Indian Prime Minister Atal Behari Vajpayee and Pakistani President Pervez Musharraf on Monday has paved the way for resumption of formal talks next month.

The development follows a series of steps the two rival nations have taken in recent months to improve their long-strained relations.

Indian Foreign Minister Yashwant Sinha made the announcement at a news conference in Islamabad. "To carry the process of normalization forward, the president of Pakistan and the prime minister of India agreed to commence the process of the composite dialogue in February 2004," he announced. "The two leaders are confident that the resumption of the composite dialogue will lead to settlement of all bilateral issues."

Mr. Sinha said the two sides are working out details about where and at which level the talks will take place.

The main dispute between India and Pakistan involves the mountain territory of Kashmir, which both sides claim. The divided region has caused two wars and almost sparked a third conflict in 2002.

India accuses Pakistan of sending Islamic militants into Indian-controlled parts of Kashmir to launch terrorist attacks, a charge Pakistani officials deny. But the Indian foreign minister says Pakistan has assured India that they will try to curb such activities.

Addressing a separate news conference, Pakistani President Musharraf called the deal with India "historic, and a good beginning."

"History has been made in that we have arrived at an agreement on taking the normalization process forward," said Mr. Musharraf, "for taking it to its logical end."

The meeting between the Pakistani and Indian leaders took place on the sidelines of a regional three-day summit of the South Asian Association for Regional Cooperation.