During a visit by Afghan President Hamid Karzai to New Delhi, India has announced a fresh aid package of $450 million for development projects in Afghanistan.   Anjana Pasricha reports from New Delhi.  

Afghanistan's President Hamid Karzai, right, and Indian PM Manmohan Singh shake hands before a meeting in New Delhi, 04 Aug 2008

After meeting with Afghan President Hamid Karzai in New Delhi, Indian Prime Minister Manmohan Singh promised an additional $450 million in aid for Afghanistan.

This will be on top of the $750 million India is already spending for reconstruction projects, such as building roads and hospitals, in Afghanistan.

The Afghan president is visiting India nearly a month after a suicide bombing at the Indian embassy in Kabul killed at least 58 people, including two Indian diplomats.  Afghanistan and India accuse Pakistan's spy agency of involvement in the bombings.

Indian Prime Minister Singh says such attacks are an effort to disrupt ties between the two countries.

"It was an attack on the friendship between India and Afghanistan.  We have agreed that we will not allow terrorism to stand in our way," he said.

Analysts say the new aid package is a signal that New Delhi will not be deterred from engaging more closely in rebuilding Afghanistan.  India is one of Kabul's largest aid donors. 

Prime Minister Singh also announced the completion of a strategic road in the country's southwest, and says it will be handed over to the Afghan government soon.  The road will ultimately link landlocked Afghanistan to a seaport in Iran.

Building the road has not been easy - Indian workers and engineers involved in the project have been the target of numerous attacks blamed on Taliban militants.  Several road workers have been killed.  In India, the attacks on its nationals in Afghanistan have been interpreted as a clear signal that New Delhi should quit the country.

Afghan President Hamid Karzai stressed the need for the world to recognize the "brutal nature" of terrorism.

"We recognize that the two countries and the world at large have no option but to be united in fighting the menace of terrorism as it affects us and as it affects the international community," said Mr. Karzai.

The two leaders also discussed strengthening security for the several thousand Indians working in Afghanistan.  New Delhi and Kabul built close ties after the overthrow of the Taliban regime.