ISLAMABAD (BLOOMBERG) - India should move towards resolving the contentious issues of the Himalayan Kashmir region, which are key to fixing the broken relations between New Delhi and Islamabad, Pakistan's Prime Minister Imran Khan said.

India's decision to end the constitutional autonomy of its portion of the divided region was behind the breakdown of ties between the neighbours, Mr Khan said at the Islamabad Security Dialogue on Wednesday (March 17). India has maintained that Pakistan needs to stop supporting terror groups it alleges have Islamabad's tacit blessings.

"With India, it is very unfortunate that we have tried to resolve our issues through dialogue like civilised neighbours, but it has not worked out," Mr Khan said. "Our only issue is basically over Kashmir."

The troubled ties between the nuclear-armed South Asian neighbours hit their lowest point in recent years after a suicide attack in India-controlled Kashmir in February 2019 killed 40 soldiers.

India retaliated with air strikes on alleged terror camps inside Pakistan. The two sides also recalled their envoys after Islamabad protested against India's moves later that year to end seven decades of constitutional autonomy for its Jammu-Kashmir state.

The two nations recently adopted a softer tone. Military commanders on both sides issued an unusual joint statement last month renewing vows to adhere to a 2003 ceasefire.

India's Foreign Secretary Harsh Vardhan Shringla called the move a welcome sign at a speech on Monday and added that "India desires good neighbourly relations with Pakistan" but Islamabad had to ensure its actions were conducive to dialogue.

Mr Khan on Wednesday appeared to indicate that talks on Kashmir could pave the way for a discussion on trade-related issues between the two countries.

"India will also benefit with more trade and connectivity to Central Asia," he said. "This is the one issue that holds us back."