Asserting that it desired peace with India as it wanted to focus on development, Pakistan said it was prepared to show 'flexibility' in resolving the Kashmir issue if New Delhi [Images] did the same.

"There cannot be any unilateral flexibility as it shows weakness and weakness never leads to peace," Pakistan Foreign
Minister Khurshid Mehmood Kasuri told China's official Xinhua news agency in an interview in Islamabad [Images].

"We need to focus on poverty reduction, rather than on defence expenditure," he said, but added quickly it will not do so unilaterally.

• The Road to Peace

Kasuri said it was important to resolve the Kashmir issue and seek a solution acceptable to all the parties concerned.

On Prime Minister Manmohan Singh's [Images] recent remarks that the time had come to make efforts to convert Siachen, the
highest battlefield in the world, into a 'peace mountain', Kasuri said Pakistan welcomed the statement and had the same
desire, but pointed out that progress was needed on the issue.

Turning to China-Pakistan ties, he said the signing of the strategic agreement between the two countries on establishing friendly and good neighbourly relations in April was a 'major event'.

"It will put in place an institutional mechanism to discuss all strategic issues in a systematic way and take into account each other's concerns," Kasuri said.