New Delhi’s lukewarm attitude to a meeting between Prime Minister Manmohan Singh and his Pakistani counterpart Nawaz Sharif has rubbed off on Islamabad, which feels there is no point in a dialogue if it is seen as a “reward” or concession to Pakistan.

As calls mounted in both countries for cessation of dialogue and a halt to normalisation of trade ties, New Delhi has made it clear that the outrage over the killing of five Indian soldiers on the Line of Control has put a question mark over a meeting between the two leaders in New York next month.

That is why Islamabad’s proposal to hold talks on confidence-building measures did not find a receptive audience. India maintains that it is the aggrieved party because early this month, five of its soldiers were killed by single bullet shots to the forehead, in a style similar to that of highly trained personnel, probably from Pakistan Army’s Special Service Group.

But Pakistan feels a “series of incidents” vitiated the environment. These include the killing of the five Indian soldiers and the abduction of four Pakistanis from its territory and their alleged killing on Indian soil after having been branded militants. It also refuses to admit that the killings were the handiwork of its soldiers. To drive home its point, it asks why the Indian Director-General of Military Operations (DGMO) did not mention the incident to his Pakistani counterpart at their weekly phone conversation that took place nine hours after the incident and why the FIR mentioned it as the handiwork of terrorists.

The high-level exchanges soon after Mr. Sharif became Prime Minister led to an understanding that Pakistan would pick an opportune moment to declare the most favoured nation status to India. This gesture would have obviated re-routing of a substantial chunk of two-way trade through Dubai, Colombo and Singapore. The expectation was that the September-end meeting between the Prime Ministers would have thawed ties enough for Dr. Singh to plan a visit to Pakistan during which the measure would have been announced. That way, Pakistan would have neutralised its naysayers, arguing that a guest could not return empty-handed.

But these prospects are uncertain after Parliaments of both countries passed resolutions, each blaming the other for the increase in violence along the LoC, and the media took up the cudgels on behalf of their governments.

To top it all, in an unprecedented action in India, 40 former diplomats, intelligence and army officers and a few officials with a brief tenure in the Home Ministry called on the government not to have any dialogue with Pakistan.

Well-placed sources say the current strategy of both countries is to let time pass so that passions generated by the killings and counter-killings and the firings are cooled off to an extent that makes reopening of the dialogue possible. If the LoC remains quiet, the governments may feel tempted to restart the normalisation process with a meeting between the Commerce Secretaries.

To gauge public perception, this meeting could be preceded by an official interaction at the middle level on water disputes.

This could help both sides take a hard look at the large number of military confidence-building measures, suggested at a meeting last December, to eliminate violence along the LoC that has bedevilled the ties since January this year. India would like frequent exchanges of military officers and close ties between military-backed think tanks. Overtime, this could force both countries to pare down their heavy military presence along the border.