Under American and Chinese pressure, Pakistan has responded to recent Indian peace initiatives with hopeful conciliatory steps that have temporarily eased tensions in embattled Kashmir. But the present lull in fighting is likely to endure only if Washington and Beijing keep up their pressure and if New Delhi grants increased autonomy to Kashmir in forthcoming negotiations with insurgent leaders.

The most important Pakistani move was a unilateral ceasefire in Kashmir that India quickly accepted. Although a welcome opening gambit, the ceasefire covers only the truce line that separates Indian and Pakistani forces.

Islamabad is still sending Pakistani guerrillas across the line into Indian-held areas of Kashmir. To avoid a resumption of fighting on the truce line, Pakistan would have to get its surrogates in Kashmir to negotiate a suspension of hostilities with Indian forces. This would be a significant reversal of past policy.

As well as extending the ceasefire from the truce line to Indian-held Kashmir as a whole, Islamabad should dismantle the infrastructure of base camps and communication centres on the Pakistan side of the line. Otherwise the existing ceasefire will increasingly be viewed by India as a ruse to facilitate stepped-up insurgent operations in spring when Himalayan snows melt.

The ceasefire could quickly break down if Islamabad uses it to harass Indian forces now seeking to build a 304-mile fence to block infiltration along a crucial sector of the ceasefire line, where the mountain passes are particularly difficult to patrol. The $2.4bn fence project, almost as ambitious as Ariel Sharon’s, has been proceeding slowly in the face of Pakistani artillery barrages, and a test of the ceasefire will be whether Islamabad permits construction work to continue.

The most encouraging evidence of a change in Pakistan’s stance in Kashmir has come in recent statements indicating a readiness to discuss India’s proposal for a bus service between Srinagar, capital of the Indian state of Jammu and Kashmir, and Muzzafarabad - the capital of Pakistan-controlled Azad Kashmir, one of the main planks in a 15-point peace plan put forward by New Delhi in October. Another welcome gesture was Pakistan’s restoration of air service between the two countries last week.

It is now up to India to promote a continued relaxation of tensions in Kashmir by showing a flexible posture in forthcoming negotiations between L. K. Advani, deputy prime minister, and leaders of Hurriyat, an umbrella organisation of insurgent groups. By offering greater autonomy and increased economic aid, New Delhi could strengthen moderate Hurriyat leaders and set the stage for a suspension of hostilities between Indian forces and most insurgent groups.

When India made its October peace proposal, Pakistan balked. Then the US began to increase pressure on Islamabad, angered not only by its intransigence towards India but also by President Pervez Musharraf’s failure to curb Islamic extremist groups in Pakistan that are fuelling the Taliban resurgence in Afghanistan and even helping al-Qaeda. Many have long-standing links to hard-line elements in his own intelligence agencies.

The Bush administration signalled its displeasure by leaking Defence Intelligence Agency documents showing links between Pakistan’s Interservices Intelligence (ISI) and al-Qaeda. Two weeks ago the US ambassador to Pakistan, pointing to a supposed ban on Islamic extremist groups, said these groups were operating under new names, often with the same leaders, and urged Gen Musharraf to "enhance" his efforts to stop them sending fighters to Kashmir.

During his recent visit to China, Gen Musharraf was startled when the Chinese presented evidence that Pakistani-sponsored insurgent groups based in Kashmir and Afghanistan were training Uighur separatists fighting Chinese rule in Sinkiang. On his return, he told Pakistani journalists it was time to correct the "negative perceptions" of Pakistan abroad. Soon after this, he announced the Kashmir ceasefire.

President George W. Bush promised Gen Musharraf $3bn more in economic and military aid when he visited Camp David last June, on top of earlier US grants and loans totalling $l.5bn, and $4bn in debt rescheduling by a US-led aid consortium. Half of this upgraded assistance is to be military aid, which gives the US powerful new leverage in dealing with the Pakistani leader.

So far Mr Bush has not had to use this leverage but he should not hesitate to do so if it should prove necessary to keep the Kashmir peace process going. It would be the ultimate folly to pour new military hardware into Pakistan if it continues to support the Kashmir insurgency, risking another war with India that could all too easily go nuclear.

The writer is director of the Asia programme at the Centre for International Policy in Washington.