ISLAMABAD -- Pakistan Saturday foreshadowed matching India's resumption of full diplomatic and air links with Islamabad, saying it will "soon" announce steps to reduce 17-month old tensions with its nuclear neighbor.

Prime Minister Zafarullah Jamali hinted at a reciprocal move in comments to United States Secretary of State Colin Powell by phone early Saturday.

"He conveyed to Mr. Powell that Pakistan will soon announce measures aimed at creating a congenial atmosphere and to promote peace and security which are vital for the region and its people," a Foreign Ministry statement said.

Jamali is expected to make the announcement during a rally today in the northwest city of Mansehra, 70 kilometers (43 miles) north of Islamabad.

Surprise peace overtures between the South Asian foes -- who were on the brink of their fourth war last year -- picked up pace Friday when Indian Prime Minister Atal Behari Vaypayee said New Delhi would revive air links with Islamabad and send an ambassador to the Pakistani capital, 17 months after severing ties.

Pakistan has welcomed the move, with Foreign Minister Khurshid Mahmud Kasuri saying Islamabad would match the pledge. Kasuri told AFP in an interview that Pakistan would appoint an ambassador to India "in due course," but is leaving the announcement to the prime minister.

Powell telephoned Jamali Saturday to praise the Pakistani premier for telephoning Vajpayee on Monday, when he invited the Indian leader to Pakistan and offered to travel to New Delhi for talks.

Vajpayee had reached out to Pakistan during his April 17-18 tour of Kashmir with a surprise announcement that India was ready to talk.

Jamali has since sent a formal invitation to Vajpayee.

He "informed (Powell) that as a follow-up to his phone call, he has sent a formal invitation to Prime Minister Vajpayee to visit Pakistan," the Foreign Ministry said.

Indian TV channels reported that Vajpayee has received the invitation.

The ice-breaking peace overtures precede next week's visit to South Asia by troubleshooting U.S. diplomat Richard Armitage, the deputy secretary of state. Powell assured Jamali in Saturday's phone call the U.S. would maintain efforts "to promote better understanding between India and Pakistan, enabling the resumption of dialogue leading to peaceful resolution of problems between the two countries."

"Mr. Powell deeply appreciated the initiative of the prime minister to call the prime minister of India," the statement said.

Amid the ground-breaking peace gestures President Pervez Musharraf reiterated Pakistan's readiness for talks.

"We stand ready to enter into a dialogue anytime, anywhere," Musharraf was quoted as saying at a banquet late Friday.

"We seek peaceful resolution of all disputes and differences especially the core dispute over Jammu and Kashmir ... we on our part will demonstrate all our seriousness," the state-run Associated Press of Pakistan (APP) reported.

The last formal talks between the nuclear armed neighbors were in July 2001 at a summit in the Indian city of Agra. Talks then broke down over Kashmir, the source of a 55-year-old territorial dispute.

Pakistan and India have fought two of their three wars over Kashmir since partition in 1947. The Muslim-majority Himalayan region straddles both countries, is claimed by both and has been split between them since 1947.

The current 17-month standoff was triggered by the deadly December 2001 attack on India's Parliament which New Delhi blamed on Pakistan and Islamic rebels fighting Indian rule in Kashmir.

Pakistan denied any connection to the attack, in which nine people and the five gunmen were shot dead.

The attack sent tensions soaring and both sides mobilized a million soldiers to their common border, where they hovered on the brink of a feared nuclear war until withdrawals began in October.

A dozen Pakistani parliamentarians will travel to India next week for unofficial meetings with Indian MPs to promote people-to-people contact, the Pakistan-India People's Forum for Peace and Democracy said.