"I warmly welcome President Musharraf's call for a 'jihad against extremism' ... and his concept of 'enlightened moderation' because of its recognition of the need... to promote tolerance and combat extremism," Straw said in a lecture in Peshawar, capital of the Islamist-ruled North West Frontier Province (NWFP).

Islam stands for "peace, love, brotherhood and harmony," he told the audience of 100 teachers and professors at the state-run University of Peshawar.

Straw was speaking on the third and final day of an official visit to the Islamic republic, where he held talks with Musharraf, a key Western ally in the war against terrorism, on nuclear proliferation, peace moves with India, Afghan reconstruction and Pakistan's four-year suspension from the Commonwealth.

He arrived the day after more than 40 Muslims from Pakistan' Shia minority were killed after an attack on a religious procession to mark their holiest day.

It was one of the worst attacks in Pakistan's two-decade history of violence between rival Shia and Sunni communities, and coincided with anti-Shia attacks in Iraq that left more than 170 people dead.

"In all these outrages, most of the victims are Muslims," Straw said.

"There could be no clearer proof that this terrorism has nothing to do with the alleged division between Islam and the West. Terrorists attack defenceless victims regardless of faith or nation."

He said both the Islamic and Western worlds needed to lift their understanding of each other.

Muslims needed to see the West as less "subversive and godless," while Westerners needed to alter perceptions of Islam as "intolerant and violent."

"Both these are distorted and mistaken views. The crucial questions are, firstly, what best can we do to correct them? and secondly, how best can we do so?" Straw said.

The West tended to "forget that secularism when taken to extremes can be just as oppressive as a society permeated by religion," Straw said.