US official holds talks in crisis-hit Pakistan

Islamabad: The top US diplomat for South Asia began a series of meetings with Pakistan's leaders on Saturday, with the US ally facing a looming balance of payments crisis as well as rising Islamist militancy.

The visit by Richard Boucher, Assistant Secretary of State for South and Central Asian Affairs, came a month after a diplomatic spat over US ground and air incursions targeting Al Qaida and Taliban militants in Pakistani territory.

Boucher met Rehman Malik, the head of the Interior Ministry, and was expected to hold talks with leaders of the seven-month-old civilian government, including President Asif Ali Zardari and Prime Minister Yousuf Raza Gilani, officials said.

Boucher's visit also follows a Saudi initiative to engage moderate members of the Taliban in a dialogue that could lead to peace talks.

While not directly involved, a spate of comments by US officials and generals have shown greater acceptance of the eventual need for some reconciliation in Afghanistan.

Both US presidential candidates, Barack Obama and John McCain, have said they would boost U.S. troop strength in Afghanistan from current levels of 32,000.