We're very worried about the continued mobilisation of two armed forces facing each other in close proximity

Christina Rocca, US assistant secretary of state

The assistant secretary of state's call comes a day after militants killed more than 30 people in an attack in Indian-administered Kashmir, most of them women and children.

Indian Prime Minister Atal Behari Vajpayee told MPs the attack was a "heinous crime" and threatened to take action in response, but did not specify what.

There were children among the dead

His remarks came as it emerged the Pakistani authorities had re-arrested the founder of a Kashmiri separatist group, Lashkar-e-Toiba, in Islamabad.

Mohammad Saeed had only been released six weeks ago, having served three months in detention after his group was banned in January.

India says President Musharraf has not done enough to tackle Islamic extremists, while Pakistan says India should make the first move by pulling back some of its troops from the border.

US President George W Bush called Mr Vajpayee to offer condolences and sympathy on Wednesday and was told that India would take "appropriate" measures in response to the attack.

'It's got to stop'

Earlier on Wednesday, Ms Rocca had appealed to Kashmiri separatists in Pakistan to stop crossing into Indian-administered Kashmir, saying any spark could ignite a war.

"It's got to stop," she told a news conference in Delhi, before flying to Islamabad.

Ms Rocca wants both sides to talk

Indian Defence Minister George Fernandes said Delhi held Pakistan directly responsible for the attack.

"Is this not a grave human rights violation by these terrorists aided and abetted by Pakistan?" he asked reporters, after visiting the scene near the winter capital, Jammu.

The attack at Kaluchak was the bloodiest since nearly 40 people died in a raid on the state assembly in the summer capital, Srinagar, last October.

Pakistan has condemned the killing of civilians in the attack, but not the attack itself.

Gun battle

The three attackers, who were wearing army uniforms, arrived by bus at the Kaluchak camp early on Tuesday morning.

Officials said they opened fire indiscriminately with assault rifles and threw grenades, killing seven other bus passengers before storming the camp gate.

The attackers were eventually killed during a gun battle with soldiers and police.

No organisation has admitted carrying out the attack, but Indian officials suspect Pakistan-based groups such as Lashkar-e-Toiba and Jaish-e-Mohammad.

A police spokesman, Subash Raina, told Reuters news agency that all three attackers were believed to be Pakistanis.

India and Pakistan have fought two of their three wars over Kashmir since independence from Britain in 1947.