Historic. Epochal.  Path-breaking.

These are the words being used to describe the understanding arrived at between India and Pakistan on the sidelines of the 12th South Asian Association for Regional Cooperation summit, which ended in Islamabad on Tuesday.

The SAARC summit: The Complete Coverage

As world powers scrambled to congratulate the two nations for restarting the peace process, officials on both sides preferred caution to euphoria.

The summit itself ended on a grand note, with three major documents being signed by the leaders of the seven-nation grouping at Islamabad's grand Jinnah Convention Centre, which was packed to capacity.

These included a free trade agreement, which becomes effective January 1, 2006, and an additional protocol on terrorism, which seeks to check the menace across the region.

But all this was overshadowed by the history being made on the sidelines of summit.

Prime Minister Atal Bihari Vajpayee had called on his Pakistani counterpart Mir Zafarullah Khan Jamali, and then on President Pervez Musharraf for over an hour. The foreign secretaries and foreign ministers of the two nations met several times, and there was intense speculation over the activities of National Security Adviser Brajesh Mishra, who was reported to have met Inter-Services Intelligence chief Ehsanul Haque, among other Pakistani leaders.

After the session was formally declared closed, with Pakistan taking over the chairmanship of SAARC until the next summit, scheduled to be held in Dhaka, Jamali held a press conference at the national library premises where he was peppered with questions on what had transpired between India and Pakistan.

Jamali expressed optimism over the meetings, but refused to divulge much apart from saying that both nations had decided "to continue the dialogue".

Following repeated prodding by journalists, particularly Pakistanis who wanted to know whether Kashmir had been sidelined or placed in a box, he replied: "It [box] is not locked. President Musharraf and Prime Minister Vajpayee have the master key and they can open it whenever they desire."

Within half an hour of Jamali's conference, the Indian side organised a meeting, which was chaired by the External Affairs Minister Yashwant Sinha.

Others who flanked him on the podium on the rooftop of the Holiday Inn were the suave High Commissioner Shiv Shankar Menon, Foreign Secretary Shashank, Mishra and external affairs ministry spokesperson Navtej Sarna.

After the usual formalities of thanking host Pakistan for the hospitality extended during the summit, Sinha read out a carefully worded one page joint statement which, according to a official, had take more than four days to finalise.

Essentially, it dwelt on the Indian concerns over terrorism, and Musharraf's pledge that he would not allow any form of terrorism on Pakistani soil.

Then came the words everyone was waiting for: "To carry the process of normalisation forward the president of Pakistan and the prime minister of India agreed to commence the process of the composite dialogue in February 2004. The two leaders are confident that the resumption of the composite dialogue will lead to a peaceful settlement of all bilateral issues, including Jammu and Kashmir, to the satisfaction of both sides."

"No," said Brajesh Mishra when asked if he had met the ISI chief, contradicting the former Pakistan foreign secretary and former high commissioner to India Niaz Naik, who had referred to such a meeting on Pakistan television the night before.

Mishra adroitly sidestepped queries on whom he had actually met in Pakistan.

Both Mishra and Sinha cautioned the media and the people of the two nations against speculating, saying that while the outlook was very positive, there were still many hurdles to cross.

Sinha also hinted at the possibility that the government was not revealing everything, saying that there was a time and a place for everything. The normally reticent Mishra warned against making bilateral relations into a "who won" kind of an issue, saying that he saw it as a "win-win" situation for both sides.

Addressing journalists a few minutes later at the Pakistan media centre in the basement of the same hotel, the normally outspoken Pakistan Foreign Minister Khurshid Mehmood Kasuri too kept referring to the joint statement whenever uncomfortable questions on Kashmir came up.

He also angrily attacked films like LoC-Kargil, saying they fomented hatred and should be boycotted. "These people make such films to make money... if you boycott the film, they will not make such movies again," he said.

He said Vajpayee had telephoned Musharraf and thanked him before leaving by a special flight for Delhi in the afternoon.

But the consistent refrain throughout the series of press meets was one of careful optimism. Both sides had obviously rehearsed and coordinated their positions beforehand.

Before they could catch their breath, the journalists from the seven nations were hustled to waiting buses, which took them to the Aiwan-e-Sadar, or the presidency, where they were subjected to innumerable checks before being let in with only pen and paper.

The huge hall with high ceilings and glittering chandeliers -- and a solitary flower bedecked table and chair at one raised end -- was lit up like a Christmas tree with halogen lamps burning into people's faces.

"We lose 10 per cent of light quality due to the live feed, you see," explained a PTV technician helpfully.

After a hurried cup of rather weak tea and biscuits, the journalists were herded into the hall, and in marched the general, with his characteristic salute.

He too preferred to temper his optimism with caution, saying that "this is just a beginning", and that there were elements in both nations out to sabotage such processes.

"There was a thaw in the Indo-Pak relations in the past few months because of positive actions taken by both sides. History had been made," he said.

While strongly asserting that terrorism would be rooted out of Pakistani soil, he admitted that he did "not have a whistle to stop violence in Jammu and Kashmir".  He could, however, "facilitate" that Pakistani soil was not misused for terrorist activities.

Shrugging off the recent attempts on his live, he said he had nine lives, and hadn't finished them yet.

He also linked giving India a "most favoured nation" status to further dialogue on all issues, including Kashmir, "whose suffering people would have to be involved at some stage or the other" in the search for a solution.

Pakistani journalists, however, did not seem too convinced. "What have we got in return for declaring the ceasefire?" "Will Kashmir be sidelined?" they asked. Denying that any backdoor deals had been made with India, he said the situation had changed dramatically since 9/11, the war on terrorism and the relentless march of globalisation, and that the region's immense potential was yet to be exploited.

"Much water has flown and a lot has happened since. Therefore, I am optimistic that the future will be different." Asked when he would come to India, he replied: "You invite me today, I will come tomorrow."