Barack Obama has called on India to engage with Pakistan to improve relations on the second day of a visit aimed primarily at cementing economic ties between Washington and New Delhi.
The US president said in remarks on Sunday in Mumbai, India's financial capital, that Pakistan was not acting quickly enough to deal with armed groups within its borders.
This view has been expressed time and again by many Indian officials who say that although Pakistan is taking aid from the US, it is also backing armed fighters in Afghanistan.
Relations between the South Asian neighbours were inflamed by the 2008 Mumbai attacks blamed on Pakistani fighters that left more than 160 people dead.
"I think the Pakistan government understands now the potential threat that exists within their own borders. There are more Pakistanis who've been killed by terrorists inside Pakistan than probably anywhere else," Obama said.
Responding to questions from students at a college in Mumbai, Obama was cautious but clear in saying that both [India and Pakistan] were needed to help stabilise Afghanistan where thousands of US troops are battling the Taliban.
Al Jazeera's Prerna Suri said the call for peace talks "did not come as a surprise to the Indian government, which sees Pakistan as a wider strategic partner of the US [and understands that] the Americans do need [Pakistan] for an [Afghanistan] exit strategy".
Hope for trust
In his meeting with the St Xavier's College students, Obama further said: "My hope is that, over time, trust develops between the two countries [India and Pakistan], that dialogue begins, perhaps on less controversial issues, building up to more controversial issues."
India has given $1.3bn in aid to Afghanistan, a policy that has been unsettling for Pakistan. India says it wants stability in Afghanistan in order to stop the country from being used to harbour hostile groups.
Obama said India's investment in development in Afghanistan "is appreciated", but added: "Pakistan has to be a partner in this process. In fact, all countries in the region are going to need to be partners in this process. The United States welcomes that. We don't think we can do this alone."
Speaking to Al Jazeera on Obama's India visit, Ayesha Siddiqa-Agha, an independent Pakistani strategic analyst in Islamabad, said the fact that he was skipping Pakistan during his regional tour would be taken as an insult. However, she said, relations between the US and Pakistan were already poor.
"There is so much anti-American hatred, or displeasure in Pakistan, whether Obama is not visiting or visiting the country does not really make a huge difference," she said.
Siddiqa-Agha also said the Pakistan military will be "extremely unhappy" over Obama's announcement of multi-billion-dollar defence deals with India, which she said will tip the arms balance in favour of India".
Obamas in Delhi
Later on Sunday, the US president and the first lady, Michelle Obama, left for New Delhi, where they were received by Manmohan Singh, the Indian prime minister, at the airport - in a departure from normally strict protocol.
The Obamas paid a visit to Humayun's Tomb, a monument built in the 15th century by the Mughal emperor Humayun. Obama was to receive a formal welcome at the presidential palace in the Indian capital on Monday.
Obama's first leg of a 10-day Asian tour has been seen as driving the US closer to India as the country tries to revive a weak economy and gather support to pressure China on its currency.
Earlier on Saturday, he urged India to relax trade and investment barriers in order to boost economic relations between the two countries.
Addressing a business meeting in Mumbai, Obama said the growing economic power must make "a steady reduction in barriers to trade and investment" in sectors from retail to telecommunications.
"As we look to India today, the United States sees an opportunity to sell our exports in one of the fastest growing markets in the world. For America this is a jobs strategy," he said.