Paying rich encomiums to Prime Minister Manmohan Singh, Pakistan President Pervez Musharraf has described him as a 'credible leader and a man of peace' and said that the world may see resolution of Kashmir issue 'earlier than expected.'

Dr Singh is a credible leader and a man of peace who supported 'Pakistan's strong desire' for settlement of the Kashmir issue as it remained a main cause of tension between the  two countries, Musharraf said, addressing the Foreign Affairs Committee of the Spanish Congress in Madrid on Wednesday.

'The world may see the resolution of Kashmir dispute earlier than expected. A reasonable progress on this account (Kashmir issue) has already been achieved,' state-run APP news agency quoted him as saying.

Musharraf observed that military solution was not an answer to resolve the Kashmir issue as the option of using force to settle bilateral disputes between Pakistan and India never worked in the past.

India and Pakistan have initiated several CBMs, but those alone would not be enough to achieve the objective of peace and normalisation of relations between both the countries, he said, adding that the two countries must move towards conflict resolution.

Facing a grim political crisis at home due to the public resentment over suspension of Supreme Court chief justice and belligerent postures by the radical militant clerics, Musharraf in the recent weeks has been sounding upbeat over the likelihood of a solution emerging to the vexed Kashmir issue.

Though out his current three-nation tour beginning with Poland after which he was scheduled to Bosnia-Herzegovina, Musharraf sounded positive about a solution to Kashmir emerging.

Ahead of his visit, Pakistan Foreign Minister Khurshid M Kasuri raised stakes by saying that Pakistan and India have 'almost' reached an 'agreement' to resolve Kashmir issue and it is being given the final shape.

'Lot of ground has been covered for an agreement on Kashmir and some areas of differences are being sorted out,' Kasuri told a local daily.

As Musharraf and Kasuri gave no details to back their optimism, many analysts believe here that it could also be an attempt to divert the attention at home from the grim political situation at home.

Kasuri's statement also came ahead of the round table meet held by Dr Singh to discuss steps to normalise the situation in Jammu and Kashmir. During his meetings in Madrid, Musharraf also said Pakistan has to eliminate the menace of extremism and terrorism, 'which is eating into the foundation of the society like termite.'

The nation has to create harmony and balance in the society and eliminate the menace of terrorism and extremism to ensure progress and prosperity of the people, he said.