The President made the appeal at an international donors' conference called to raise money for the recovery effort after last month's quake, which killed nearly 74,000 people in Pakistan.
"Let us together solve the Kashmir dispute once and for all," the President said in an address to the conference, which included a ministerial-level delegation from India.
"Let this be the Indian donation to Kashmir," he said to applause from about 300 delegates. The President said the earthquake had provided a rare "fleeting opportunity" to heal the relationship between the two South Asian nations. "If leaders fail to grasp fleeting opportunities, they fail their nations and they fail their people. "Let good and success and let happiness emerge from the ruins of this catastrophe, especially for devastated people of Kashmir," he said.
"I sincerely and genuinely believe that the challenge of this earthquake can be converted into an opportunity of a lifetime that was never available to India and Pakistan to improve its relations," he said. The Indian representative at the conference, state minister for external affairs E. Ahmed, reiterated India's commitment to confidence-building measures between the neighbours.
"The spontaneous outpouring of support and goodwill for the victims of the earthquake gives us the strength and motivation to work (towards) confidence-building measures between our two countries," Ahmed told the meeting.
"On Kashmir our position is well known ... (to live) in an atmosphere free of terrorism and violence," he said.
India pledged 25 million dollars towards the quake assistance effort at a conference in Geneva on October 26. International donors at that meet promised 580 million dollars in assistance.