"Peace in South Asia is hostage to one accident, one act of terrorism, one strategic miscalculation by India," the president said while addressing the 57th session of the UN General Assembly.

"In this dangerous situation, crisis management cannot afford to become a substitute for conflict resolution," Musharraf said as he outlined his three-point proposal for reducing tensions in the region: 1) Mutual withdrawal of forward deployed forces by both states, 2) observation of a ceasefire along the Line of Control in Kashmir, and 3) cessation of India's state terrorism against the Kashmiri people.

He said the structure for such a dialogue should be based on the formula agreed upon in his meeting with Indian Prime Minister Atal Behari Vajpayee in Agra in July 2000.

The people of Kashmir, he said, should be fully associated with the dialogue process and should be allowed to travel freely in Pakistan and Azad Kashmir.

To ensure sustainable peace and stability in South Asia, Musharraf said: "A Kashmir solution should be accompanied by agreed measures for nuclear restraint and a conventional arms balance between India and Pakistan.

"India's ongoing massive military build up reflects its known desire for domination over South Asia and the Indian Ocean. In the interest of regional and global stability, this must be discouraged," he added.

"Misusing the rationale of the war against terrorism, India has sought to de-legitimize the Kashmir freedom struggle, tarnish Pakistan with the brush of terrorism and drive a wedge between it and its coalition partners," he said.

INCREASE IN PDL MAKES POL COSTLIER

Petrol and diesel have become costlier by eight to nine per cent from September 1, 2001 to September 2002 as a result of increase in petroleum development levy (PDL) followed by surge in dealers' and distributors' margins and not because of increase in international oil prices.

Petrol is now priced at Rs34.32 per litre as compared to Rs31.64 per litre on September 11, 2001, showing a rise of 8.47 per cent.

Diesel price is now tagged at Rs19.48 per litre as compared to Rs17.77 per litre, up by nine per cent, while kerosene, which was being retailed at Rs17.40 per litre, is now available at Rs18.41 per litre.

Oil prices were hovering between $26-27 a barrel a year back as compared to prevailing prices of $28-29 a barrel.

GOVT NOT TO CHANGE COTTON TRADE POLICY

The government has decided not to change the policy of free import and export of the silver fibre, said Commerce Minister Abdul Razak Dawood, on Monday.

While addressing a press conference after a seminar on cotton at the Central Cotton Research Institute (CCRI), the minister said after taking into account the view-points of the all stakeholders — growers, ginners, exporters/importers and textile mill owners — it has been decided that the policy of free cotton import and export must remain intact.

UPLIFT AID TO PAKISTAN WILL CONTINUE: JAPAN

Japanese Prime Minister Junichiro Kozumi assured Pakistan on Wednesday that Japanese aid for Kohat Tunnel, Indus Highway and other projects would continue and that his country would keenly observe the upcoming general election in Pakistan.

Talking to journalists after talks with the leaders of Japan, Denmark and Bulgaria, President Pervez Musharraf said the bilateral meetings had been excellent.

He said a number of issues, including the tension between India and Pakistan and the October elections, had been discussed during the bilateral meetings.

NEW COMMISSION REPLACES UGC

President Pervez Musharraf on Wednesday established the Higher Education Commission through an ordinance which will replace the University Grants Commission (UGC).

The controlling authority of the new commission will be the prime minister or the chief executive, who will then appoint a chairperson, having international eminence who has made significant contribution as teacher, researcher or administrator. The chairperson will have the status of a federal minister.

INCOME TAX RELIEF FOR SALARIED CLASS

The Central Board of Revenue(CBR) has amended the income tax rules 2002 extending some relief to the salaried class.

CBR, in this regard, issued a notification on Wednesday substituting Part-I of chapter-II of the Income Tax Rules, 2002. The revised rules would thus stand enforced, added the notification.

UBL SELL-OFF TRANSPARENT

The Privatization Commission (PC) on Tuesday claimed that the UBL transaction was transparent and was very much in line with the required procedure.

A spokesman for the PC in a statement said that UBL transaction has attracted a lot of publicity and almost every day there is some news item or article appearing in the media hotly debating the transaction and its outcome.

WAPDA SHARES' TRANSFER

The government would transfer 100 per cent shares of Wapda worth around Rs300 billion to 12 corporate companies before Dec 31, 2002, to enable sale of these entities to the private sector, informed sources told.

These Wapda shares were earlier transferred from 'Residual Wapda' to President of Pakistan around two years back as required under $1 billion power sector restructuring and reforms programme of the World Bank (WB) and the Asian Development Bank (ADB) for onward transfer to the private sector after privatization.