"The chances of a war between the two countries are less than one percent now," Shujaat was quoted by India Today magazine as saying in its issue released Friday.

The two countries came to the brink of their fourth war in 2002 after the Indian parliament was attacked by Islamic rebels New Delhi said were sponsored by Islamabad. Pakistan denied the charge.

The two sides remain at loggerheads over Kashmir, which both claim in full but administer in parts, but this year they resumed negotiations on all disputes.

The peace process has nudged forward since India's then prime minister Atal Behari Vajpayee offered a surprise "hand of friendship" to Pakistan on an April 2003 visit to Kashmir.

"I give full credit to India for its willingness to have a dialogue on the Kashmir issue after a lapse of 30-odd years," said Shujaat, who is expected to be replaced as premier later this month by Finance Minister Shaukat Aziz.

Meanwhile, India and Pakistan wrapped up two days of high-level talks Friday on ways to demilitarise a strategic glacier in disputed Kashmir and agreed to meet again to discuss the issue but set no date.

"The two defence secretaries agreed to continue their discussions with a view to resolving the Siachen issue in a peaceful manner," a joint statement issued at the end of the talks in the Indian capital said.

The statement did not specify a date for the resumption of talks about the 20,700-foot (6,300-metre) glacier where more troops have died of frostbite and altitude sickness than in fighting.

Siachen, known as the world's highest battlefield, is located in a remote area of Kashmir which is held in part by nuclear rivals India and Pakistan but claimed in full by both.

India and Pakistan, which have fought three wars since their 1947 independence and came close to a fourth in 2002, said they held "frank and candid discussions in a "cordial and constructive atmosphere aimed at taking the process forward."

Mutual mistrust has so far blocked attempts to demilitarise the frigid wasteland.

The deployment forces on the glacier is hugely expensive for both countries.