Pakistan President Pervez Musharraf has said there can be no headway in the confidence  building measures to improve ties with India without the resolution of the Kashmir issue.

"While we are working both on dialogue and CBMs with India, Kashmir is the main dispute, which must be resolved. Until there is a progress towards its resolution, there can be no headway on CBMs or other issues," he said, addressing army officers at the concluding ceremony of the army wargames 'Sabit Qadam-III' in Islamabad last night.

Musharraf's comments come ahead of his scheduled meeting  with the Indian External Affairs Minister Natwar Singh today.

Asserting that Pakistan wanted peaceful resolution of all issues with India, including Kashmir, he said maintenance of
credible, conventional and strategic deterrence was the cornerstone of Pakistan's national security strategy.

"We shall not only maintain it (the policy of deterrence) but also enhance it further," an official statement quoted Musharraf as saying.

He also assured the participants of the wargames that balance of power in the region would be maintained and needs of modern hardware, weaponry and technology of the three services would be met.

In his speech, Musharraf emphasised that all time preparedness of war is guarantee for peace and that and efforts should continue to be focused on the principles of peaceful coexistence, without lowering Pakistan's guard.

The vice-chief of army staff Gen. Yousuf Khan who acted as the director of the war games, expressed his satisfaction on drawing all the intended lessons set for exercise Sabit Qadam-III.

Sabit Qadam-III, a computer simulated wargames exercise, was undertaken by the Pakistan army for a few weeks at the
army headquarters in Rawalpindi.

Earlier Musharraf, during talks with visiting German Foreign Minster Joschka Fischer, expressed concern over Germany's support for India's bid for a permanent seat in the United Nations Security Council.