The political leaders of Afghanistan and India have forged closer ties between their nations by signing a "strategic partnership" following talks in New Delhi.
The agreement, announced on Tuesday after Karzai's meeting with Manmohan Singh, the Indian prime minister, is the first such pact between Afghanistan and another country and aims to boost trade, security and cultural links between the countries.
Karzai's visit to New Delhi on Tuesday came against a backdrop of deteriorating relations between Afghanistan and Pakistan in the wake of the assassination of Burhanuddin Rabbani, a former Afghan president appointed by Karzai to lead negotiations with the Taliban.
Karzai, speaking at a press conference with Singh, stressed again that "terrorism and radicalism" were being used "as an instrument of policy against our citizens."
It appeared to be a veiled reference to Pakistan.
Singh said the deal created "an institutional framework for our future co-operation."
"It is a hugely symbolic visit for India because Karzai's visit comes at a time when relations with Pakistan, India's arch-rival, are at an all-time low and Pakistan has consistently denied India a role in the post-conflict Afghanistan situation," said Al Jazeera's Prerna Suri.
"The Indians are grabbing onto this opportunity, possibly by getting a more meaningful role with this visit."
Moeed Pirzada, a Pakistani columnist and TV journalist, told Al Jazeera that Pakistan was not too concerned at the moment about Karzai's visit to India.
"There is a clear understanding in Islamabad that Karzai is on the spot and has to make adjustments because of recent developments," he said.
The assassination of Rabbani and accusations of close relations between Pakistani intelligence and the Taliban-linked Haqqani network had forced Karzai "to show a certain level of hostility towards Pakistan," Pirzada added.
With regards to details of security co-operation between Afghanistan and India, Pirzada said Pakistan was "waiting to see the fine print".
"If they are only concerning the police, they [the Pakistanis] are not really worried. They are not expecting Karzai to cross any red lines that Pakistan is sensitive over."
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In a primetime national address on Monday, Karzai accused Pakistan of "pursuing a double-game", saying Islamabad was not co-operating in the battle against armed groups to establish peace in Afghanistan.
Karzai said he had always stood by friendly relations with Pakistan, hoping to face the challenge of cross-border extremism together, but that the neighbouring nation had failed him, continuing to use "terrorism as a means".
"The Islamic republic of Pakistan has not co-operated with us to bring peace and security to Afghanistan, which is unfortunate for us," he said.
Karzai acknowledged that his efforts for peace had failed as his overtures were met with more violence and targeted killings, most recently of his chief peace negotiator, Rabbani.
"The killings show that our call for peace has not seen a positive response. One-sided desire for peace will not bring a resolution. Peace can only be achieved with those who believe in it."
"We have to fight decisively against those who do not believe in peace."
Karzai's comments follow Pakistan's criticism by Admiral Mike Mullen, chairman of the US joint chiefs of staff, who accused Pakistan's ISI intelligence agency last month of playing a role in the recent attack on the US embassy in Kabul.
The Haqqani network has denied links to the ISI and also involvement in last month's assassination of Rabbani.
Afghan officials have blamed the Taliban for the September 20 turban bombing, saying Rabbani's killer was Pakistani and that the attack was plotted by the Afghan Taliban's leadership body, the Quetta Shura, in Pakistan.