"This is a golden opportunity for both India and the United States to partner in a way that will bring peace and stability in this part of the world," he said after the talks in New Delhi.

"We must find ways for the two militaries to interact which will convince our friends that we can work together and tell our potential enemies that we will protect our citizens from harm," he said.

Pace is scheduled to meet National Security Adviser M.K. Narayanan for talks on Muslim insurgency in the Indian-administered zone of Kashmir, Indian officials said.

The officials said Pace's three-day visit to the capital was an attempt to "familiarise himself with the Indian military leadership."

Both the Indian navy and air force are currently considering multi-million dollar deals to buy American military hardware. Pace is the first chairman of the US Joint Chiefs of Staff to visit India since a July 2003 trip by General Richard B. Myers.

He insisted that Washington did not block a now-suspended test of India's latest nuclear-capable ballistic missile which has an official range of 4,000 kilometres (2,480 miles).

"India is a sovereign nation and it will decide what weapons it will test or not test. Nations in the region have tested various weapons and missiles tests do not destabilise countries of the region," he told reporters after the talks.

Last June, Indian and US defence ministers signed a 10-year accord paving the way for joint weapons production and cooperation on missile defence.

Political ties between the two countries have also improved since they signed a landmark civilian nuclear deal during a visit by US President George W. Bush to New Delhi in March.

The deal seeks to lift a decades-old ban on transfer of advanced nuclear technology to India, but still has to be approved by the US Congress and the Nuclear Suppliers Group.

Pace said the two countries were planning more joint military exercises, after successful ones in recent years.

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