She told the assembly that for development and progress of Jammu and Kashmir, peace and reconciliation between India and Pakistan is a must and that the main agenda of her government is to encourage this.
Referring to last week's terror attack on Central Reserve Police Force convoy in Pampore in which eight security personnel were killed and 21 injured, she said "such senseless acts of violence" amount to "showing contempt to this Holy month" of Ramdhan.
Such acts send a wrong signal about the situation which can have grave consequences on the overall economy of the state, Mehbooba said on the last day of the Budget session.
"These attacks have not yielded anything in past, despite so much bloodshed, and they will not yield anything in future. They only bring bad name to Kashmir. The month of Ramadhan calls for self-control and restraint. By indulging in such senseless acts of violence, you are showing contempt to this Holy month," she said.
"Whether a CRPF man dies, a civilian is injured or a militant gets killed, it only perpetuates pain and suffering on the families and in the society," she said.
Lauding the Parliamentary system of democracy in India, she recalled the words of former Prime Minister of Pakistan Zulfkar Ali Bhutto that if India is thriving, despite its inherent contradictions and challenges, it is because of its democratic traditions.
"Now see what is happening in countries where democracy has ceased to exist. Full-blown wars are going on in Syria and Libya. The blood of innocents is being spilled. Although people in these countries are free as individuals, they don't have the freedom to make choices for themselves.
"In a true democracy, individuals should get that right to decide his or her future which is what makes India such a great country," she said.
Mehbooba said India and Pakistan have been engaged in hostilities over the last six decades on the issue of Jammu and Kashmir.
"These hostilities make the people of J&K their prime targets. But my government is looking for a way forward," the Chief Minister said.
She recalled that Hurriyat leaders, in a meeting with the then Deputy Prime Minister L K Advani, had agreed that they will come up with a roadmap for resolving the vexed Kashmir issue.
"We want the process of dialogue and reconciliation started again so that peace is restored in the state. My sole ambition is to pull out people from the vortex of violence and address the issue of under development in Jammu and Kashmir," she said.
She said a "fruitful dialogue" between India and Pakistan took place during the first tenure of her father Mufti Mohammad Sayeed as Chief Minister in 2002.
After the tenure of that government led by PDP, "no progress was made and all the measures taken to restore peace in the state were pushed into oblivion," Mehbooba said and attacked National Conference, saying "the Opposition need not remind us what we have to do."
She said the agenda of her government is to nudge India and Pakistan towards starting a meaningful dialogue on Jammu and Kashmir so that the three-decade period of violence in the state comes to an end and the region enters into a new era of peace and prosperity.
A meaningful dialogue between India and Pakistan on Jammu and Kashmir is part of 'Agenda of the Alliance' of the PDP-BJP government which is a comprehensive document for resolution of all issues faced by the state.
"If we want peace and prosperity in J&K and if India and Pakistan want to prosper, it will not happen by waging proxy wars or direct wars, or allegations and counter allegations, it will happen if the two countries sit around a table and resolve their differences," she said.
The chief minister said a large chunk of population in both India and Pakistan, living in abject poverty, don't get access to basic amenities like healthcare and education.
"The budget spent by two countries on purchasing arms can easily be diverted to building social infrastructure and helping the poor and disadvantaged if the two countries resolve their differences," she said.
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