India was among the countries worst affected by terror with militant attacks in Jammu and Kashmir [Images] and in the north-east, strikes by Naxalites and attacks elsewhere in the country taking a toll of more than 2,300 lives in 2007, the US state department said.

The state department, in its annual report on terrorism, said terrorist activities along the Line of Control in Jammu and Kashmir are on the decline, but Pakistan-based militant outfits like the Lashkar-e-Tayiba and other terrorist groups continue to plan attacks in the Valley.

"Pakistan-based Lashkar-e-Tayiba and other Kashmir-focused groups continue regional attack planning. In 2007, Kashmir-focused groups continued to support attacks in Afghanistan, and operatives trained by the groups continued to feature in Al Qaeda [Images] trans-national attack planning," it said.

The report said Indian government's counter-terrorism efforts remained hampered by outdated and overburdened law enforcement and legal systems.

"The Indian court system was slow, laborious, and prone to corruption. Terrorism trials can take years to complete. Many of India's local police forces were poorly staffed, lacked training, and were ill-equipped to combat terrorism effectively," the report said.

Noting about the attack on Samjhauta Express, the report said, it was carried out by extremists who tried to incite anger among the Hindus and Muslims.

"These attacks, which killed and injured both Muslims and Hindus, were probably conducted by extremists hoping to incite anger between the Hindu and Muslim communities. Indian officials claim that the perpetrators of these attacks have links to groups based in Pakistan and Bangladesh, particularly the Lashkar-e-Tayiba, Jaish-e-Mohammed, and Harkat-ul-Jihad Islami, among others," the report said.

"These groups also have links to terrorist activity in Jammu and Kashmir. The number of civilians killed were approximately half of that in the previous year. In May, the Indian government acknowledged that the level of infiltration across the Line of Control had fallen, but noted that insurgents had in some case shifted routes to enter India through Bangladesh and Nepal," it said.

The report also took note of the formation of the anti-terrorism mechanism between India and Pakistan to coordinate and exchange information on terrorists.

"Pakistan's leaders took steps to prevent support to the Kashmiri militancy, and the number of violent attacks in Kashmir was down by approximately 50 per cent from 2006, according to public statements made by the Indian defence minister," the report said.

The report also took note of the US-India Joint Working Group on Terrorism, which has so far met nine times since its formation in 2000.

India participated in CTJWGs with 15 other countries, and in multilateral CTJWGs with the EU and with the Bay of Bengal Initiative for Multisectoral Technical and Economic Cooperation, an organisation that promotes economic cooperation among Bangladesh, India, Myanmar, Sri Lanka [Images], Thailand, Bhutan and Nepal.

In October, the Indian government held the second round of consultations with Pakistan under the bilateral counter-terrorism joint mechanism, and hosted a ministerial level meeting of the South Asia Association for Regional Cooperation on counter-terrorism," it said.

On Pakistan, the state department said international terror organisations, including Al Qaeda and its supporters continue to operate and carry out attacks from the country.

The report said Al Qaeda has rebuitt some of its pre-September 11 capabilities from remote hiding places in Pakistan, and terrorist attacks in neighboring Afghanistan increased 16 per cent last year.

The report said despite efforts by both Afghan and Pakistani security forces, instability along the Pakistan-Afghanistan frontier appeared to have provided the Al Qaeda greater mobility and ability to conduct training and operational planning, particularly targeting Western Europe and the United States.

"Numerous senior Al Qaeda operatives have been captured or killed, but Al Qaeda leaders continued to plot attacks and to cultivate stronger operational connections that radiated outward from Pakistan to affiliates throughout the Middle East, North Africa, and Europe," the report said.