“It’s a very dangerous situation between the two countries,” Trump told reporters on Friday in the White House.
“Right now there [are] a lot of problems between India and Pakistan because of what happened,” he said.
Tensions have soared between the nuclear-armed rivals since a suicide attack last week killed 42 soldiers in Indian-administered Kashmir, the deadliest attack in 30 years of armed rebellion in the Himalayan region.
India has been demanding action against armed fighters from Pakistan, with Prime Minister Narendra Modi under pressure from his Hindu nationalist base to show firmness weeks before he is set to call elections.
The attack was claimed by Jaish-e-Mohammad (JeM), an armed group based in Pakistan, although the suicide attacker came locally from Indian-administered Kashmir.
Pakistan’s military on Friday warned India against any “misadventure”, saying it was capable of responding.
India and Pakistan have fought two of their three wars over Kashmir since their partition following independence from Britain in 1947.
The Trump administration last year cut off $300m in military aid to Pakistan, saying that Islamabad has not done enough to fight armed rebels at home or close safe havens for fighters in neighbouring Afghanistan.
Trump, however, added the United States has developed a “much better” relationship recently with Pakistan and added that the US may set up some meetings with Pakistan.
US envoys say Pakistan has an important role to play in Afghan peace talks, given its links to the Taliban.