Musharraf was due to visit Embraer, the world's fourth largest civil aircraft manufacturer, after holding talks Monday in the capital with Brazilian President Luiz Inacio Lula da Silva.

The two countries signed several agreements on drug trafficking and visa issues, while the Pakistani leader voiced optimism in peace talks with neighbor and nuclear rival India.

"We have initiated a process of rapprochement with India and we look forward to a peaceful coexistence with India in the region, through confidence-building measures and through the resolution of all disputes," Musharraf said Monday.

"May I say, I see a light at the end of the tunnel, now ... the process of rapprochement has started," the general said.

Pakistan and India have fought two of their three wars over the disputed territory of Kashmir, but in April last year then-Indian prime minister Atal Behari Vajpayee started the current peace process by offering a "hand of friendship" to Pakistan.

However, Musharraf went on to say -- as he departed a lunch with Lula -- that the peace bid "needs two hands to clap."

"So my hand is there, I hope the other hand will also be there and then we will be able to reach peace. But peace by resolving all disputes, which includes the dispute of Kashmir."

Earlier Monday, the two nuclear rivals agreed new dates for a meeting between their top foreign ministry officials to review progress on the peace process, according to an Islamabad-based foreign ministry official.