Indian Prime Minister Atal Behari Vajpayee says India will never give up Kashmir and he is urging Pakistan to abandon its efforts to claim the disputed area.
In a New Year's message from the coastal state of Goa, Mr. Vajpayee said Pakistan can not fight religious extremism and modernize itself as long as it chooses to be in perpetual confrontation with India.
He said India and Pakistan should instead agree to promote beneficial trade and economic ties, strengthen cultural relations and encourage greater people-to-people contacts.
Since independence from Britain in 1947, India and Pakistan have fought two wars over Kashmir, which is divided between them and claimed in full by both. They came dangerously close to a third war this year.