The leaders of Pakistan and India have made angry statements blaming each other for the military confrontation in Kashmir - dashing hopes of a swift resolution to the current crisis.

Indian Prime Minister Atal Behari Vajpayee accused Pakistan of breaking its promises to prevent cross-border infiltration by militants, but said he was prepared to talk to Islamabad if demands were met.

We have seen that cross-border infiltration has increased, violence in Kashmir has continued unabated and terrorist camps continue to exist across our border

Atal Behari Vajpayee

Pakistani President Pervez Musharraf, for his part, censured India for failing to resolve the Kashmir dispute and said that his country would not start a war, but would react with utmost resolution if war is imposed on it.

The two nuclear powers have massed a million troops along their border since a December raid on the Indian parliament that Delhi blamed on Pakistan-based militants.

Pessimism

The two leaders are attending a regional security summit in Kazakhstan, where it was hoped they would hold face-to-face talks to defuse the growing tension.

But the BBC's Central Asia correspondent, Catherine Davies, says that following the bellicose opening statements there is now pessimism about the prospects for such an encounter.

Vajpayee says Musharraf must halt "cross-border terrorism"

Mr Vajpayee has said that face-to-face talks could only take place if Pakistan did more to prevent cross-border infiltration.

"On 12 January the president of Pakistan promised no organisation would be allowed to indulge in terrorism in the name of Kashmir," he said.

"We have seen in the following months that cross-border infiltration has increased, violence in Kashmir has continued unabated and terrorist camps continue to exist across our border," he added.

Heavy price

Mr Musharraf responded with a veiled reference to India in which he denounced what he described as state terrorism.

He also criticised actions against what he called people's legitimate right to freedom, an apparent reference to Kashmir.

	Rising tension: 1 October 2001: 38 killed in attack on the Kashmir assembly in Srinagar 13 December 2001: 14 killed in attack on the Indian parliament building in Delhi 14 May 2002: More than 30 killed in attack on an Indian army camp in Kashmir 21 May 2002: Moderate Kashmiri politician Abdul Ghani Lone shot dead Troubled relations over the years

"The people of South Asia continue to pay a heavy price for the refusal by India to resolve the Kashmir dispute in accordance with resolutions of the United Nations and the wishes of the Kashmiri people," he said.

Russian President Vladimir Putin, also attending the summit had hoped to mediate between Mr Musharraf and Mr Vajpayee.

"The explosive state of relations between India and Pakistan causes deep concern," Mr Putin said in his opening remarks.

"This is seriously destabilising the situation on the entire South Asian subcontinent."

China's President Jiang Zemin is also attending the conference, and - like President Putin - was due to hold separate meetings with the Indian and Pakistani leaders.

On Tuesday the 16 nations attending the summit adopted the Almaty Act, which condemns terrorism and commits its signatories to not support separatist movements.

Press optimism

The Indian and Pakistani leaders' hardline remarks contrasted with reports in India's press which responded with optimism to an apparent softening of the tone of comments from Indian officials in the last few days.

Putin hoped to mediate between the two countries

On Tuesday, many newspapers were hailing what could be the start of the diplomatic breakthrough.

"India talks down war fever", said a headline in the Times of India - its editorial reflecting a general feeling that the worst may now be over.

Fresh violence

Meanwhile, exchanges of fire between Indian and Pakistani troops across the Line of Control have killed at least two people and injured 10 others in the past 24 hours.

Police in Indian-administered Kashmir said one person had died in the Punch district when the area was shelled by Pakistani forces.

Officials in Pakistan-administered territory said a man was killed as Indian troops targeted his village in Bargh district with mortar, artillery and machine gun fire.

As the stand-off continues, foreign nationals and non-essential diplomatic staff from many countries continue to leave the two countries.

India says it will carry out a black-out exercise in Indian-controlled Kashmir on Tuesday to prepare people for possible aerial attack from Pakistan.