India has asserted it will fight its own battle against terrorists in Kashmir and ensure the return of 300,000 pandits to the valley.

"I think there is no substitute to India winning this whole issue (battle against terrorists) and succeeding and these 300,000 people (Kashmiri Pandits) going back," Arun Jaitley, Minister for Law, Justice, Commerce and Industry said.

He was speaking at the Clement Attle lecture and banquet organised by Labour Friends of India on the subject 'Why India Matters?'

Over 500 distinguished guests including Lord Swraj Paul, leading NRI and ambassador for British Overseas Business, Lord Kang, Indian high commissioner to the United Kingdom, Ronen Sen, S P Hinduja and G P Hinduja, chairman and president respectively of the Hinduja Group and members of the Confederation of Indian Industry currently in London attended the lecture and banquet at the Radisson SAS Portman Hotel on Tuesday night.

Jaitley noted that there was an increased alienation of the people of Kashmir from terrorists and from the ideology of terror. 

"There is a lot more positive situation, it seems to be developing there. There also seems to be a lot of pressure on Pakistan to stop this cross-border activity. And there is some change of intent (on the part of Pakistan Government), at least in ostensible pronouncement the leadership of the regime that is making today," he said.

Answering questions at the end of his lecture, Jaitley said he could not bind himself to a timeframe either on the question of restoration of normalcy in Kashmir or resumption of India-Pakistan dialogue.

Asked whether the dialogue would take place before the end of this year, he said, "The timetable has not been decided yet. The timetable depends on certain factors, which the leadership of India and Pakistan would take into consideration."

While stating that perpetrators of terror in Kashmir stood isolated, Jaitley said, "They do receive some patting on the back from across the border."

"But the battle of Kashmir and the battle against terror will have to be fought by India and our intelligence network has been galvanised, the security improved, resulting in heavy casualty on the part of terrorists," he said. "The number of terrorists' attacks has also been going down."

Both Peter Mandelson, MP, former minister who delivered the Clement Attlee lecture and Jaitley appreciated the role played by former British prime minister Clement Attlee in declaring India's Independence.

Mandelson welcomed the diplomatic peace established between India and Pakistan. "I welcome the diplomatic peace, however, fragile, that has been established between India and Pakistan and I pay tribute to Prime Minister Vajpayeeji for his vision, his personal commitment and some political wisdom he has shown to bring peace."

Mandelson said India has made great progress in the last decade and a half - creation of a huge middle-class, booming inward investment and bouncing forward of the knowledge economy.  

"By opening up its economy, India has shown its magnificent creative potential, making it one of the fastest growing economies of the world, also courtesy Bollywood, one of the best projected countries as well," he said.