Pakistan and India initiated dialogue after a year's break on Friday afternoon at the imposing Punjab House. This was also the venue of the June 1997 talks, which led to the Islamabad Declaration.

At the end of the first day of talks, the two countries' foreign secretaries held a press briefing addressed by joint spokesman Tariq Altaf, who is additional secretary in Pakistan's Ministry of Foreign Affairs.

Altaf told journalists that the Indian and Pakistani sides had held, ``frank, warm and cordial discussions on the items of peace and security.''

``They have explored the full range of issues of peace and security, including Confidence Building Measures (CBMs),'' Altaf added.

Indian Foreign Secretary K Ragunath is heading an eight-member delegation to resume talks that were suspended in September last year.Shamshad Ahmad, his Pakistani counterpart, is leading the Pakistani team. ``They've made an attempt and identified areas of convergence,'' Altaf said, reading from a carefully-worded statement.

Islamabad and New Delhi also agreed to review the existing CBMs so as to enhanve their efficacy, said Altaf. ``They have explored ways and means to continue discussion on these issues. Some of our technical experts are already meeting,'' Altaf added.

The Pakistani foreign secretary said, in reply to a question, that both sides were ``in the middle of discussions'' which would continue over dinner and later tonight. ``We are discussing everything in a cordial manner and will let you know at the end of the talks whatever the outcome is,'' Ahmad said.

Ahmad told reporters that both countries needed to develop a regime for restraint, after they exploded nuclear devices in May.

Friday's talks focussed mainly on issues of regional peace and security which top the eight-point agenda agreed upon by the two countriesduring talks last June. Talks on Saturday will be devoted to the Jammu and Kashmir issue.

The closing session has been set for Sunday morning, after which a press conference will be held and a joint statement issued. Another round of talks will be held in New Delhi next month to discuss other bilateral issues between the two countries.