India's Manmohan Singh and his Pakistani counterpart Syed Yousuf Raza Gilani said their often strained ties were improving, but they declined to give a date for their next meeting.

"The time has come to write a new chapter in the history of our countries," Singh told reporters. "The next round of talks should be far more productive and far more practical-orientated in bringing the two countries closer."

Gilani said that "all issues" had been discussed during their one-hour talks including the contentious subject of Kashmir, a Muslim-majority region which is divided between the two nuclear-armed countries.

"The (Indian) prime minister has always been open and put his cards on the table," Gilani said. "The next round of talks will... open a new chapter in the history of the two countries."

The leaders did not give further details of their discussions on the sidelines of the South Asian Association for Regional Cooperation (SAARC) gathering in the Maldives.

Singh added there had been "some positive movement but more needs to be done" to strengthen ties.

India and Pakistan both struck an upbeat note ahead of the SAARC summit, with officials describing the cross-border atmosphere as "considerably improved".

However, the vexed subject of Kashmir and the threat of Pakistan-based extremism remain major obstacles to their ongoing peace process.

A full peace dialogue -- suspended by India after the 2008 Mumbai attacks blamed on Pakistan-based militants -- was resumed in February this year.

The process remains tentative with only incremental progress on issues such as trade.

The two prime ministers last met in March when Gilani accepted Singh's invitation to watch the India-Pakistan cricket World Cup semi-final. Their previous talks were at the April 2010 SAARC summit in Bhutan.

Last week, Pakistan's cabinet announced it had approved a proposal giving India the status of "most favoured nation" but there has been confusion since about when it will be implemented.

Efforts to reduce tensions have been complicated by the increasing influence of Afghanistan in the bilateral equation.

Indian involvement in Afghanistan is sensitive, with Pakistan vehemently opposed to its arch foe meddling in what it considers its backyard.

Islamabad's suspicions were fuelled when Afghanistan and India signed a strategic partnership pact last month.

Afghan President Hamid Karzai is also attending the SAARC summit, along with the leaders of other member nations Bangladesh, Bhutan, the Maldives, Nepal and Sri Lanka.

Maldivian President Mohamed Nasheed, who is taking over the leadership of SAARC, said he wanted India and Pakistan to shed their differences and help rejuvenate the body, which is seen by critics as an ineffectual talking shop.

His office said he was keen that the two rivals resolve their issues and help release the potential of a grouping that accounts for a fifth of humanity in one of the world's poorest regions.

Copyright AFP (Agence France-Presse), 2011