Earlier, addressing a gathering of elite Australian entrepreneurs, intellectuals and members of Asia Society in Sydney, President Musharraf renewed his call for effective participation of the industrialised world in the socio-economic development of the developing nations as part of the strategy to steer the world out of its present turbulence marked by unrest, inequality and the menace of terrorism.
The president also called upon the western capitals, particularly Washington, to help in resolving political disputes affecting the Muslim countries with justice.
"In the globalised and interconnected world, security is indivisible and conflict situations cannot be insulated in today's international environment.
"The US should lead efforts to resolve the political disputes afflicting the Muslim countries with justice, because it is the long-running disputes that give rise to powerlessness, hopelessness, extremism and terrorism, which endangers world peace," he said in his address on the subject of "Pakistan - challenges, response and opportunities."
He said that while the danger of global confrontation has receded with the end of the Cold War, the world remains an insecure place with persistence of old disputes such as Palestine and Kashmir, new conflicts and the new threat of terrorism.
Referring to the unevenness and economic inequalities in regions around the world, he said, the islands of prosperity could be drowned if the oceans of poverty continue to expand.
"The developed nations must come with the avowed 0.7 percent contribution for the attainment of Millennium Development Goals."
On countering terrorism, he said, it has to be dealt with force, adding that Pakistan would continue its campaign against terrorists until all operatives are flushed out of the country.
He said the fight against terrorists is being fought at strategic, intelligence and tactical levels.
"We believe that terrorism must be rejected and countered forcefully as it threatens to disrupt modern societies," he said.
At the same time, the president emphasised, the world must address root causes of extremism. He recounted the events of the last two-and-a-half decades in the region, particularly the emergence of al Qaeda and the Taleban in Afghanistan and freedom struggle in Kashmir and said these had their fallout on the Pakistani society.
Pakistan, he said, is addressing the malaise of extremism through a comprehensive strategy, focusing on promoting education and reducing poverty.
The government is also endeavouring to streamline education in Madressahs and has banned extremist organisations.
The president said a parallel danger is implicit in the false notion of clash of civilisations, especially the West and Islam.
He called for correcting misperceptions about Islam and said the Muslim societies are vastly moderate. "The dangerous thesis of clash of civilisations must be rejected," he said, adding that his strategy of enlightened moderation seeks to promote understanding and inter-civilisational harmony.
On Pakistan-India relations, he said that both the countries are engaged in a peace process for the resolution of decades-old Kashmir dispute. He said sincerity, flexibility and courage from all sides is required to find an amicable settlement to the dispute.
President Musharraf informed the Australian entrepreneurs that Pakistan has been put on the path of high economic growth through key reforms and continuity of fiscal policies in the last five years.
"All the economic indicators are positive and today foreign direct investment and investment by Pakistani expatriates is coming in an encouraging way. This will further stimulate economic development. Pakistan today holds immense promise for business on the back of robust growth in both rural and industrial sectors," he said.
Pakistan, he said, offers trade and energy corridors to regions, including Central Asia, South Asia, the Gulf region and western parts of China.
He said that any trade between these regions has to take place through Pakistan whether it is supply of gas from landlocked Central Asian states and the Gulf states to India or trade between western parts of China and India or trade between Central Asia and the Gulf and the world markets.
"The landlocked but energy-rich Central Asian states are looking to reach out to the world markets through Pakistani ports," he said.
The government, he said, is fully concentrating on using Pakistan's economic potential and is in the process of concluding work on Gwadar deep seaport, road networks and other facilities required for bolstering regional trade.
"Pakistan should not be seen as a standalone country - it is at the heart of trade opportunities between half of the world's population."
He said that with continuity of policies, Pakistan has the enormous promise of moving forward as a progressive dynamic Islamic country.
He said the introduction of local government system at the grassroots level and checks and balances at the top level and political reforms have for the first time brought true democracy in Pakistan.
"There is freedom of expression, the local government system is bringing about a silent revolution, women and minorities have been empowered with women having unprecedented representation at all tiers of the government."
Amid standing ovation the president concluded that Pakistan is moving forward as a moderate and progressive Islamic country.
"Pakistan is on its way to progress like a dynamic and moderate Islamic country," he added.