Why is Pakistan President Pervez Musharraf keeping such a low profile on the recent peace moves between India and Pakistan?

The answer to that question will decide whether the latest initiative will pave the way for real peace or go the way of the Lahore and Agra summits.

Some analysts say General Musharraf is holding back so that if the talks fail, he can blame the civilian government. But that is too simplistic a view.

In his press conference in Islamabad on Thursday, US Deputy Secretary of State Richard Armitage maintained that while Musharraf had denied cross-border infiltration, he had also promised that if any terrorist infrastructure remains in Pakistan-occupied Kashmir, it would be 'gone tomorrow'.

Musharraf knows that India will certainly verify this pledge using its satellite imagery of the region. India also knows that the dismantled terrorist camps can be resurrected within days at different locations.

But New Delhi also believes that Musharraf's statement vindicates its longstanding view that he does have control over the terror camps in PoK. Earlier, the Pakistani strongman had consistently refused to acknowledge that he had any power to stop the jihadis, whom he describes as freedom fighters, operating out of the region.

Armitage, while categorically denying that he had any 'peace plan' for the region, stressed that the US was acting as a 'facilitator' to encourage talks between the two nations. But Indian -- as well as some Pakistani -- analysts believe that Washington is turning up the heat on Musharraf and the Inter-Services Intelligence, which is credited with helping the jihadi elements in Kashmir.

Armitage's meeting with the ISI chief, Lieutenant General Ehsanul Huq, in Washington on Monday, the eve of his departure for the subcontinent, is thus significant. Gen Huq, who arrived in Washington on Sunday for a week's visit, is also reported to have met Secretary of State Colin Powell, National Security Adviser Condoleezza Rice, Homeland Security chief Tom Ridge and Vice-President Dick Cheney.

From the Indian side, National Security Adviser Brajesh Mishra too is in Washington talking to the same officials.

The recent decision by the Pakistani government to prepare to grant India Most Favoured Nation status in trade is also said to be on account of US pressure. The announcement of MFN is likely to be made shortly.

This has been a longstanding demand by New Delhi, which had given similar status to Pakistan long ago as per the South Asian Association for Regional Cooperation charter. Economic experts believe that India-Pakistan trade, which currently stands at a meagre $206 million, has the potential to reach $4 billion annually.

At the same time, Pakistan alerted India that it would seek international arbitration to help resolve yet another dispute arising out of India's plan to construct a hydro-electric power project on the Chenab river, which Islamabad believes will block its water supply.

This announcement -- by Pakistan's Minister for Water and Power Aftab Ahmad Khan Sherpao, who said his ministry had received orders from Prime Minister Mir Zafarullah Khan Jamali to formally inform India of this decision -- came a day before Armitage's visit.

Taking a cue from the Chinese example, India has consistently demanded stepping up trade and cultural ties, while leaving contentious issues on the backburner. But until now, Pakistan has refused, saying the Kashmir issue has to be resolved first. This time analysts hope Pakistan Foreign Minister Khurshid M Kasuri's assertion at Armitage's press conference that Kashmir is still a key issue was meant more for the hardline elements within Pakistan than as a message to India.

While Armitage made no mention of an American proposal to make the LoC an international boundary at his press conference in Islamabad, there have been consistent media reports that this was part of his peace plan for the region. Both sides claim all of Kashmir, and despite the ground realities, any attempt to legitimise the other side's hold on the territory is likely to cause major domestic upheavals.

In India, hardliners are likely to point to the parliamentary declaration made on February 22, 1994, which, among other things, demands: "Pakistan must vacate the areas of the Indian state of Jammu and Kashmir, which they have occupied through aggression."

As for Musharraf and Jamali, who heads a government that is essentially radical Muslim, they believe that any sign of officially ceding what they call Indian-held Kashmir would lead to massive protests from the jihadi elements, who have already proclaimed that no matter what, the war in Kashmir will continue.

Musharraf, however, is likely to cite the concessions already made to India and the possible threat to the Pakistani polity owing to this to garner more economic and military aid from Washington. On Thursday, Pakistan announced that it is seeking a $1 billion aid package from the US, this including $400 million budgetary support for health, education and poverty alleviation in 2004.

A report in the Lahore newspaper Dawn said the government also expects to get $200 million under the USAID programme and $150 million as a cash grant. In addition, it said, separate financial support is likely to be offered by the Bush administration as part of the military assistance programme for limited use of military bases in Pakistan. This assistance will cover funding to the interior ministry to help control narcotics and terrorist activities.

On Tuesday, after a meeting with US Ambassador to Pakistan Nancy Powell, Finance Minister Shaukat Aziz said Pakistan hopes to receive sizeable financial assistance from the United States next year, and the Bush administration is expected to write off the remaining $2 billion debt.

But whether this economic largesse will be enough to buy peace on the subcontinent remains to be seen.