Prime Minister Manmohan Singh [Images] on Sunday told Pakistan President Pervez Musharraf [Images] that redrawing of borders is not possible but he is in favour of bringing the people of Kashmir and Pakistan-occupied-Kashmir together.

Briefing journalists on the two-hour talks at the Hyderabad House between Dr Singh and Musharraf, Foreign Secretary Shyam Saran said the prime minister suggested steps like increased transportation linkages between India and Pakistan and more people-to-people contacts.

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Musharraf, while stressing the importance of the Jammu and Kashmir [Images] issue, agreed that the recent confidence building measures between the two countries had made a lot of progress. The Pakistan president favoured that such measures should be continued and intensified, Saran said.

The foreign secretary said the "mood was very positive and forward looking" at the meeting and the prime minister told Musharraf that he is prepared to travel towards a lasting peace between the two countries.

During the past one-and-a-half years, there has been a significant change in the relationship between the two countries and a transformation has taken place in the public mood, Singh told Musharraf.

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He also referred to the India-Pakistan statement of January 6, 2004, particularly to the assurances that no part of Pakistan would be allowed to be used for any terrorist activities against India.

This assurance, the prime minister said, opened new opportunities for improvement of relationships between the two countries.

Dr Singh said it is the responsibility of the two countries that this positive movement in the relationship is not thwarted by the activities of terrorist elements.

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Saran said India welcomed Pakistan's condemnation of terrorist attack on the Srinagar-Muzaffarabad bus.

The prime minister shared his vision of South Asia's future with Musharraf and said if India and Pakistan, as two biggest economies of the region, were to join hands and bring their creative energies and resources together, it will be possible to transform the economy of the region.

Observing that this was possible, Singh said this is the direction in which he will like to take the process forward, Saran said.

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Musharraf, Saran said, responded "very positively and shared the prime minister's vision" in improving the livelihood of
the people of both countries and synergising their energies to ensure shared prosperity.