A somber and visibly tense Prime Minister Nawaz Sharif said tonight that he was "trying to avoid nuclear war" by asking Islamic militant groups to withdraw from the mountains of Indian Kashmir, where they have been battling Indian troops for seven weeks.

In a televised speech to the nation, Sharif invited Indian Prime Minister Atal Bihari Vajpayee to meet with him, saying it was "very sad we have not resolved the Kashmir issue," even after India and Pakistan have fought two wars over the disputed territory.

Because weapons tests last year established Pakistan and India as the world's newest nuclear powers, Kashmir has become a "nuclear flash point," Sharif added. "I am trying to avoid nuclear war," he said. "It is suicide. I don't believe in suicide, and I don't believe Prime Minister Vajpayee does either."

Sharif, who has been widely criticized at home for meeting with President Clinton this month and then pledging to ask the guerrillas fighting inside Indian Kashmir to back off, pointedly praised the insurgents for bringing international attention to the 50-year-old dispute. Warning that Kashmir is a "volcano" that can erupt again, Sharif sought to place the onus on the international community to press for a solution of the dispute and said he had told U.S. officials that ending the current phase of fighting was not enough.

Pakistani officials said today that the gradual "disengagement" of Pakistani-backed fighters was proceeding along the Line of Control that divides the Indian- and Pakistani-controlled parts of Kashmir. Indian and Pakistani military forces were observing an unofficial cease-fire in those areas, they said.

However, Pakistan unleashed a ferocious barrage of artillery fire tonight on a highway inside India's portion of Kashmir, the Associated Press reported. For at least half an hour, shells smashed into the road and a mountainside every 30 seconds.

Several major Islamic militant groups here continued to assert today they would not withdraw from the conflict along the Line of Control, and Pakistani officials continued to disavow any direct knowledge of their actions, insisting the groups are operating independently of Pakistani control.

In New Delhi, Indian officials acknowledged that the withdrawal of Pakistani-backed fighters--who the Indian government says include Pakistani troops--had begun, but they insisted it was "a mere formality" because Indian forces had succeeded in recapturing most of the terrain the militant groups occupied in April. Since his July 4 trip to Washington to meet with Clinton, Sharif has been accused here of caving in to American pressure to withdraw the Islamic fighters, whose cause of freeing southern Kashmir from Indian control has long been championed by Pakistan. Indian and American officials say most of the fighters are actually Pakistani army troops and that the cross-border operation was controlled and sustained by Pakistan.

Some informed sources have said Clinton privately confronted Sharif with this charge and Pakistani officials then agreed that they would threaten to cut off virtually all support for the Islamic fighters unless they backed off. In return, Clinton publicly promised to take a "personal interest" in the Kashmir problem.

"These so-called meetings with the mujaheddin [guerrillas] asking them to withdraw was nothing but a show," said Khalid Mahmud, a specialist on Indo-Pakistani relations at the Institute for Regional Studies. Pakistani officials, he said, "had already decided what to do and had informed the Indians" the forces would retreat.

Despite Sharif's efforts to portray himself as pursuing peace and security for the region, critics across the Pakistani political spectrum suggested his credibility and image have been tarnished and that resuming dialogue with India soon may be virtually impossible.

"No Indian prime minister will be able to muster any enthusiasm for talking with Nawaz," said Abida Hussain, a legislator from Sharif's party, the Pakistani Muslim League. "The prime minister has survived crises before, but this is the first one with external dimensions. He will face a very difficult situation now."

CAPTION: Prime Minister Sharif was accused of caving in to U.S. pressure to withdraw militants from Kashmir.