"We believe the way forward for the two countries is to resume the stalled composite dialogue process at the earliest," Zardari said on Thursday.
He said that Pakistan wanted to transform bilateral relations with India into a friendly and cooperative partnership through resolving of outstanding disputes.
Zardari, however, maintained that the two sides need to ensure that the recent incidents along the Line of Control should not derail the peace process.
"Our new democratic government has exercised restraint," Zardari said, adding that "the Prime Minister is committed to peaceful relations with India and has stated that his government will continue to exercise restraint".
He made the remarks while speaking at a dinner hosted in the honour of Islamabad-based diplomats at the Presidency last evening to thank them for their support and cooperation during the past five years.
Zardari will demit office on September 8, following which newly elected Mamnoon Hussain would take over as the 12th President of Pakistan.
He said that Pakistan sincerely desires to establish durable peace and stability in the neighbourhood. "We need peace and stability to realise the vast potential of mutually beneficial cooperation in diverse fields," Zardari said.
He reiterated Pakistan's commitment to support an Afghan- led and Afghan-owned process of transition as the war-torn country approaches the next important stage of transition with the drawdown of foreign forces.
"We are extending every possible support to the efforts for intra-Afghan reconciliation," he said.
Besides the diplomats, the dinner was also attended by Prime Minister Nawaz Sharif, Chairman of the Senate, Speaker National Assembly, Federal Ministers and Parliamentarians.
Zardari said democracy was taking roots in Pakistan, as for the first time in the country's history an elected civilian President would be handing over charge to another elected civilian President in a smooth and orderly manner.
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