The history of bilateral relations between Pakistan and India since the independence in 1947 has been beset by mistrust and characterized as a most difficult relationship. This has led to significant defence expenditure by both countries. It is clear that if relations can be improved or at least better managed in this age where, globally, confrontation is being increasingly replaced by cooperation, the “peace dividend” would be in the interest of both countries and improve the lot of their peoples, a significant portion of whom live in conditions of poverty or on the margins of poverty. In this context since the peace process begun in 2004 through the composite dialogue process constituted an important element for managing this relationship and towards efforts for its improvement. The eight agenda items of the Composite Dialogue are: (i) Peace and Security including Confidenc- Building Measures (CBMs); (ii) Jammu and Kashmir; (iii) Siachen; (iv) Sir Creek; (v) Wullar Barrage; (vi) Terrorism and Drugs Trafficking; (vii) Economic and Commercial Cooperation; and (viii) Promotion of Friendly Exchanges. While India froze the peace process after the November 2008 Mumbai terrorist incident, it is worth assessing what was and what was not achieved to assess the utility of trying to restart the process in its entirety rather than through pick and choose, presently the hallmark of the Indian approach. Meaningful CBMs were reached in a number of key areas. On Jammu and Kashmir – a core issue for Pakistan, which remains committed to a peaceful resolution based on the Security Council Resolutions supporting the right of self determination of the Kashmiris – a number of inter-Kashmiri CBMs were implemented to bring some relief to the lives of the Kashmiri people. The Muzaffarabad – Srinagar and the Rawalakot – Poonch Bus Services and an inter-Kashmir trade service were initiated. The age-old linkage between the Kashmiri people and their brethren in Pakistan was restored to some degree. Kashmiri liberation leaders were able to visit Pakistan. Nuclear and Conventional CBM agreements were reached on Pre-Notification of Flight Testing of Ballistic Missiles and on Reducing the Risk from Accidents Relating to Nuclear Weapons. A hotline between the Foreign Secretaries was started and the hotline between the two Director Generals of Military Operations was upgraded. Both countries recognized that the nuclear capabilities of each other, which are based on their national security imperatives, constitute a factor for stability. They reaffirmed their commitment to uphold the ceasefire along the LoC; implement the 1991 Agreement on Air Space Violations in letter and spirit; not to develop new posts and defence works along the LoC; to speedily return inadvertent Line Crosses, and; to periodically review existing CBMs. A hotline between the Indian Coast Guards and Pakistan Maritime Security Agency was initiated. While India has frozen the composite dialogue it is important to note that the above CBMs continue to be observed. On the economic and commercial side, bilateral trade increased from US$181 million to US$195 million in 2007 – 2008. While trade balance was in favour of India significant quantities of cement were exported from Pakistan to India and the Pakistani positive import list expanded. The PakistanIndia Joint Commission which had been dormant since 1989 was revived and meetings held on Agriculture; Tourism; Information Technology & Telecommunications; Health, Information; Environment, Science & Technology; and Education. Important areas where both countries face similar challenges. People-to-people contact increased. However overall despite some amelioration of the plight of the Kashmiri people there was no substantive move forward by India on the core issue of Jammu & Kashmir. Similarly, on Siachen and Sir Creek despite the availability of a framework for their resolution India kept to its adamantly negative positions. On the Indus Water issue, India's tactics reflected an attitude to use its upper riparian position to circumvent its solemn obligations under the Indus Waters Treaty and to try to build up a capability to pressure Pakistan. At a time when terrorism is a major threat to both countries, India has used the unfortunate Mumbai attack not only to freeze the peace process but also to halt the two mechanisms putting place for counter terrorism discussion and cooperation namely the meetings of the Interior Secretaries and the Joint Anti-Terrorism Mechanism. While Pakistan has taken all possible measures on its side in relation to the Mumbai attack, India is shortsightedly trying to use this incident to polemicise against Pakistan. In fact there is strong evidence that India is using Afghanistan territory to mount subversive and destabilizing operations against Pakistan particularly in the border regions. When the two Prime Ministers met in Sharm El Sheikh in July 2009 both agreed that the two countries will share real time, credible and actionable information on future terrorist threats and that dialogue is the only way forward. Action on terrorism was not to be linked to the Composite Dialogue process. However, India went back on this understanding. The recent meeting of the two Foreign Secretaries last month in New Delhi continued the impasse with India only interested in discussing terrorism issues. The Government of Pakistan has sincerely and continuously tried to restart the peace process in its entirety through the Composite Dialogue process. Many Pakistanis disillusioned with the Indian response have called on the government to halt such efforts. However, the peace process showed that while movement on vital issues was painfully slow, a potential window towards resolution had been opened and in some areas particularly in inter-Kashmiri contacts and on Nuclear and Conventional CBMs which are important between the two nuclear neighbors some progress had been achieved to manage this difficult bilateral relations. Recent statements made by Indian military leaders of their objective to be able to mount aggressive actions against Pakistan under a nuclear overhang demonstrate a gearing differential between India's professed peaceful intentions in regard to Pakistan at the political level and the reality of its strategic build-up and objectives. Two developments are crucial to move from adverse relations and potential conflict towards resolution of disputes particularly the core issue of Kashmir and the Indus Waters issues and cooperation for the benefit of the two peoples. The first is for a fundamental realization by India that it has more to gain through better relations with all its neighbours rather than through a coercive and hegemonic approach. China, for example, has tried its best to develop good relations with all its neighbours and to solve territorial border issues in a generous manner. India on the other hand has extremely difficult relations with all its neighbours what to talk of Pakistan. Secondly, since peace and stability in South Asia is so important in the entire region and beyond, the international community has to play its part in persuading India to pursue a policy to meaningfully engage with Pakistan and to work for the maintenance of stability in South Asia which will also permit Pakistan to pursue its major global role against terrorism. No doubt the friendly Kingdom of Saudi Arabia would have used its influence in this regard during the recent visit of the Indian Prime Minister. – SG Tariq Osman Hyder is a retired Pakistani diplomat who led his country's delegations in Nuclear, Conventional and Anti