Pakistan's armed forces "are fully prepared and capable of defeating all challenges." Pakistani President Gen. Pervez Musharraf

Both India and Pakistan in recent days have deployed substantial combat forces to important strategic areas along their borders and with tension continuing to mount the Indian army has ordered residents in border villages to leave. The powerful Indian air force has moved more equipment to the frontier bases both to bring units based there up to full war strength and to further reinforce them with more Fighter units from Central and Eastern Commands. Indian defence ministry officials pointedly say that they are only responding to a massive troop build-up by Pakistan.

Heavy machine-gun fire and continual shelling by both sides forward positions continued through much of the last three nights in the Galahar sector of the Jammu region of Kashmir during which the Indian army said it had destroyed eight Pakistan bunkers in response to the killing of two Indian soldiers on patrol in the area on Sunday.

Prime Minister Atal Bihari Vajpayee has clearly concluded that Pakistan was responsible for a suicide attack on India's Parliament and has since withdrawn his ambassador to Pakistan and ordered a shutdown of cross-border train services. In a clear statement of the level of anger felt in India Mr Vajpayee said "There is worry in many nations about what will happen if there is a war between India and Pakistan" he went on to add "We do not want war, but war is being thrust on us and we will have to face it."

Pakistan's President General Pervez Musharraf response was to warn India against any aggression."Let me assure my countrymen that your armed forces are fully prepared and capable of defeating all challenges," he added, quoting Pakistan's founding father, Mohammed Ali Jinnah ."Relations could improve provided the Indian government will shed the superiority complex and will deal with Pakistan on an equal footing"

Tensions have markedly increased since the December 13th attack on the Parliament in New Delhi and the number of clashes have grown since in Kashmir, an area that has bedevilled relations between the two states for over fifty years and resulted in four major conflicts. In an informal briefing before the Cabinet Committee on Security, the Army Chiefs of Staff have already expressed their preparedness for war and appear to have come to the somewhat dubious conclusion that any action against the Pakistan controlled areas of Kashmir would not lead to a large-scale conflagration since Pakistan's present political situation would not allow its army to undertake a full-fledged war with India.

High-altitude reconnaissance aircraft and unmanned spy drones are keeping a close watch on Pakistani army movement while satellites are being used to identify terrorist camps in the Pakistan controlled area's of Kashmir. India's Defence Research and Development Organisation has also developed a sophisticated manpack Battlefield radar and these have been rushed into use. Short-range and light, the radar's weighing only 30 kg, they can spot a crawling man from 500 metres, a walking man from 2 km, and a group of men from 5 km and would prove invaluable in the difficult terrain of much of Kashmir and are in addition to the new long-range Battlefield surveillance radars purchased from Israel and France

>From the tactical intelligence gained, the Indian Chiefs of Staff will decide on which of the several options that are available to them. These include a substantial ground attack penetrating upto 25kms inside the Line of Control with full air cover or a comprehensive US-style bombing assault using Mirage-2000 and Sukhoi-24 supersonic attack fighters along with the first use of the 200km Prithvi ballistic missiles in a 24-36 hour air blitz.

However, most independent observers are doubtful that if the conflict escalates in Kashmir that a wider war along the international borders between India and Pakistan could be avoided for long. The knock-on effects of a major conflagration involving two nuclear armed powers on Afghanistan, relations with China, the US War on Terrorism and the overall stability of the South Asia could be incalculable and both the United States and the UK governments are privately expressing serious concern.

Acute pressure is being applied by the State Department on both Islamabad and New Delhi to do everything possible to avoid an all out war and the United States is acutely aware of how closely mirrored India's reactions to a long series of Islamic provocation's culminating on 12-13 are to the events of 9-1. So too is the distrust and growing irritation with General Musharref's regime in Pakistan.

Britain's hard pressed Security and Police services will no doubt have been warned to prepare contingency plans to deal with any overspill of any conflict onto the crowded streets of a number of major UK cities where the two immigrant communities live in close proximity. Although there was little or no trouble between ethnic Indians and Pakistanis during past wars, under the heightened tensions prevailing since the Islamic attacks on the USA the chances for inter-communal violence in Britain is now far greater.

The nightmare that any conventional conflict between these two heavily armed Asian States could slip into a limited nuclear exchange should be sufficient to spoil the New Year holidays of most senior politicians on both sides of the Atlantic. Richard M. Bennett - AFI Research, London

NEW DELHI, India -- Associated Press, 26 December: India said its missiles were "in position," air force jets flew near the Pakistan border every few minutes and frontier forces exchanged gunfire Wednesday as the two nuclear-armed nations prepared for a war both say they don't want.

India's Cabinet Committee on Security was meeting Wednesday evening to discuss further diplomatic pressure on Pakistan, including a possible ban on Pakistan airline flights, abrogation of a water treaty, downgrading of embassies, and cancellation of Pakistan's "most favored nation" trading status.

"Missile systems are in position," Defense Minister George Fernandes told Press Trust of India. India's arsenal includes medium-range Russian missiles and the Indian-made Prithvi I, which can be fired from a mobile launcher and has a range of 93 miles.

Pakistan and Indian news media reported that Pakistani missiles - including medium-range Chinese-made weapons - had also been put on alert, while troops on both sides moved toward the border.

Both sides' missile systems can be converted to deliver nuclear warheads, but it is not clear whether such steps have been taken.

But he also criticized Muslim militants in Pakistan, who he said have "undermined Islam to a level that people of the world associate it with illiteracy, backwardness, intolerance."

India has demanded Pakistan take further steps against two Muslim militant groups that New Delhi accuses of being behind a Dec. 13 gun attack on Parliament that left 14 dead. Tensions between the two countries have spiraled, with India saying Pakistan's spy agency sponsored the attack, a charge Islamabad denies.

There have been daily exchanges of gunfire between the troops, although officials from both sides said the border region was relatively calm Wednesday.

In contrast to previous periods of tension with India, Pakistan has been more cautious with its rhetoric. Officials in Islamabad have declined comment, saying they do not wish to escalate the war of words.

Pakistan's position has been bolstered by its new presence on the world stage, which has increased with its cooperation with the U.S.-led coalition against terrorism.

Pakistan froze the assets of Lashkar-e-Tayyaba and Jaish-e-Mohammed, which India accuses in the Parliament attack and which are battling to end Indian rule in Kashmir. Pakistan also briefly detained the leader of Jaish-e-Mohammed on Tuesday. But New Delhi said the steps fall far short of its demand that the groups' activities be halted and their leaders arrested and handed over to India.

India and Pakistan have fought three wars since their violent division at independence from Britain in 1947. Two of the wars have been over Kashmir, the mostly Muslim Himalayan region that is divided between them. Both claim all of it.

"We do not want war, but war is being thrust on us and we will have to face it," Prime Minister Atal Bihari Vajpayee said at a public address at his residence Tuesday, celebrating his 77th birthday.

India recalled its ambassador from Islamabad and announced plans to shut down train and bus service between the two countries on Jan. 1, saying the diplomatic offensive is intended to pressure Musharraf to take strong action against the guerrillas.

Islamic militants have carried out strikes in the Indian part of the Kashmir region since 1989, fighting for independence or merger with Pakistan in an insurgency that human rights groups say has killed more than 60,000 people. India says the militants have also struck elsewhere, including at Parliament, where 14 people, including five attackers, were killed.

Musharraf condemned the Parliament attack, but said he would take no action without proof against the militants, whom he calls "freedom fighters." He denies that his government helps or has any control over them.

India is also lobbying for international pressure on Pakistan, comparing the militants with the terrorist network that the U.S.-led coalition is fighting in Afghanistan.

Soldiers traveled to the border state of Rajasthan by train Wednesday and air force jets flew over the border town of Jaisalmer every seven minutes.

However, despite anti-aircraft batteries posted at airports and the army turning schools into bunkers, there were signs that war was not the first priority.

A summit of the seven South Asian leaders - including Vajpayee and Musharraf - remained scheduled for next week in Katmandu, and Nepal said it had assurances that both men intended to come.

News reports quoted Indian military sources as saying they would not be ready for a full-scale war for several months and would prefer to avoid fighting in the winter.