India's deputy prime minister said yesterday that car bombings in Mumbai and a spate of attacks in Indian Kashmir could hurt a peace process with Pakistan.

Indian police have blamed an outlawed Indian students' group and a banned Pakistan-based Kashmiri militant group for the twin blasts in Mumbai on Monday which killed 51 people.

They also blamed the same militant organization, the Lashkar-e-Taiba, for an attack on Wednesday in Kashmir's main city Srinagar, which culminated in an overnight gunbattle in which five died, including two militants.

Speaking in Srinagar, Deputy Prime Minister Lal Krishna Advani did not blame Pakistan directly for the attacks, but said these would nonetheless hurt the peace process between the nuclear-armed neighbors.

"I am sure our neighbor would be conscious of the fact that happenings of the kind that happened yesterday here or in Bombay two days back do affect the whole process adversely," he told a news conference.

The two countries came close to war last year over Indian allegations, denied by Islamabad, that Pakistan is stoking the Kashmiri separatist militancy.

But they began a tentative peace process in April, restoring diplomatic ties and resuming bus links.

Civil aviation officials from both countries also held two days of talks in Islamabad on Wednesday and Thursday on restoring air links but apparently failed to make any headway.

A joint statement said after the meeting ended that the officials would set a new date for further discussions.

Air links were suspended and overflights banned after an attack on India's parliament in 2001 which New Delhi blamed on Pakistan-based militants. Islamabad denied involvement.

The ban on overflights has hit Indian airlines hard, since they had to reroute all their flights going west to avoid Pakistani airspace. By contrast, Pakistan had far fewer flights going east over India.

Advani did not go into detail on how the peace process could be affected.

But in an interview published on Thursday in The Australian newspaper, Foreign Minister Yashwant Sinha revived India's traditional anti-Pakistan rhetoric which has been missing or muted during the thaw of the last few months.

Calling Pakistan "the epicenter of international terrorism," he said almost all attacks in India had links leading into its smaller neighbor.

Earlier on Thursday, Indian troops killed two militants in a hotel in Srinagar after an overnight gunbattle which coincided with the arrival of Prime Minister Atal Behari Vajpayee.

Three other people including a former state legislator died in the shootout, about five km (three miles) from the building where Vajpayee and state chief ministers were holding a meeting meant to highlight a return to normality in Indian Kashmir.

Police did not say how they had identified the militants as members of the Lashkar-e-Taiba.

India held state elections in Kashmir, its only Muslim-majority state. last year, aiming to try to bring peace to the Himalayan region. More than 38,000 people have died in Kashmir's 14-year separatist revolt.

AFP adds: Prime Minister Atal Behari Vajpayee said Wednesday that India wanted a dialogue in Kashmir with all who shun violence and extremism, as he started a heavily-guarded visit to the troubled province.

Suspected Islamic rebels replied by launching three attacks soon after he touched down in Srinagar, summer capital of Indian-administered Kashmir, in which a soldier was killed and six other people injured, police said.

The main purpose of Vajpayee's visit was to hold talks with leaders of India's 28 states, with a crackdown on "terrorism" expected to top the agenda two days after twin car bombs killed 52 people in Bombay.

"We will further intensify our sincere efforts to advance the dialogue process (in Kashmir)," Vajpayee said as he inaugurated the conference.

"Our doors are open to all those who reject militancy and extreme positions and wish to play a constructive role in taking Kashmir forward on the high road of peace and rapid development."

N.N. Vohra was appointed by the Vajpayee government to talk to all parties in Indian Kashmir to find a solution to the 14-year rebellion that has left more than 38,000 people dead.