ISLAMABAD: The Kashmir trade pact finalised by Pakistan and India is a "big achievement" that will have a "far-reaching" effect on improving bilateral ties, Foreign Minister Shah Mahmood Qureshi said on Sunday.

"One should not underestimate this development as it will have a far-reaching impact as far as economic integration to facilitate the Kashmiri people is concerned," Qureshi told reporters in the eastern city of Multan.

The composite dialogue between Pakistan and India has entered its fifth round and the intra-Kashmir trade pact is a big achievement on the path to improving ties with India, he said. "We are doing all this to facilitate the people of Kashmir," he remarked.

Trade between the two parts of Kashmir across the Line of Control will be launched on October 21 and modalities for this are being finalised, Qureshi said.

Pakistan is "moving forward in the dialogue process with India on the basis of its historical stance on the Kashmir issue," he pointed out.

President Asif Ali Zardari too had highlighted the Kashmir issue at the UN General Assembly, he added.

Qureshi said he had informed his Indian counterpart Pranab Mukherjee that "core issues" should be addressed while moving forward with the process of dialogue.

Referring to Pakistan''s concerns about the reported diversion of water from the Chenab river for the Baglihar dam in JK, Qureshi said Pakistan would protect its share of river waters. President Zardari raised the issue of alleged stoppage of water during his meeting with Prime Minister Manmohan Singh on the sidelines of the UN General Assembly, he said.