UPDATE 2 - Trump says US, Pakistan seeking 'tremendous' potential

ADDS WHITE HOUSE STATEMENT ON TRUMP-KHAN MEETING

By Michael Hernandez

WASHINGTON (AA) - The U.S. and Pakistan are seeking to meet the "tremendous potential" in their bilateral ties, President Donald Trump said Monday.

"We haven't met the potential of either country," Trump told reporters in the Oval Office while hosting Pakistani Premier Imran Khan. "I think the potential with Pakistan, and likewise the opposite way, we haven't come close to meeting it."

Khan is in Washington for his first visit to the U.S. since becoming prime minister in August 2018.

"To be honest, I think we have a better relationship with Pakistan right now than we did when we were paying that money,” said Trump, referring to the roughly $1 billion in security assistance to Pakistan he cut off last year, blaming Islamabad for not doing enough to fight extremism.

“But all of that can come back depending on what we work out," he said. "We are working on things that are very, very important."

Khan said he will be asking the U.S. president to help establish peace with India, noting the subcontinent's people "are held hostage to the issue of Kashmir".

"Only the most powerful state, headed by President Trump, can bring the two countries together," said Khan. "We have made all overtures to India to start dialogue, resolve our differences through dialogue, but unfortunately we haven't made headway as yet."

Trump expressed a willingness to take up the herculean task, saying Indian Prime Minister Narendra Modi asked him to mediate.

"If I can help, I would love to be a mediator. It’s impossible to believe two incredible countries that are very, very smart with very smart leadership can’t solve a problem like that," Trump said.

India, however, denied Modi made the overture and quickly rejected any role for the U.S. in the talks, citing its policy "that all outstanding issues with Pakistan are discussed only bilaterally".

"Any engagement with Pakistan would require an end to cross-border terrorism. The Shimla Agreement & the Lahore Declaration provide the basis to resolve all issues between India & Pakistan bilaterally," Raveesh Kumar, the spokesman for India's Ministry of External Affairs, said on Twitter.

Kashmir has been contested by India and Pakistan since 1947 when each country seized portions of the territory. Both countries claim the Himalayan territory in full.

Since they were partitioned in 1947, Pakistan and India have fought three wars -- in 1948, 1965 and 1971 -- two of them over Kashmir.

- Trump-Khan meeting

The two leaders met to discuss how both nations could work together to bring peace, stability and economic prosperity to South Asia, according to a White House statement.

"The President and Prime Minister discussed the threat that terrorism presents to regional stability and discussed ways in which Pakistan can support a peaceful resolution to the conflict in Afghanistan," said the statement.

"Trump acknowledged initial steps that Pakistan has taken to facilitate Afghan peace efforts. He also affirmed Prime Minister Khan’s stated commitment to take action against militants and terrorists," it said.

Trump and Khan agreed that economic engagement between the two countries would foster development in Pakistan as well as investment and jobs in the U.S.

"Both leaders concurred that such engagement would also contribute to peace and prosperity in the wider South Asia region," it said.

Trump also hoped that the two leaders "would revive all aspects of the bilateral relationship, including expanding trade deals and strong military-to-military ties, as they continue to make progress toward bringing peace and stability to South Asia", the statement added.

*Servet Gunerigok contributed to this story