By Mark Hosenball and Chris Allbritton
WASHINGTON/ISLAMABAD (Reuters) - The head of Pakistan's powerful Inter-Services Intelligence directorate met CIA Director Leon Panetta on Monday to discuss ISI demands for greater control over U.S. spy operations on Pakistani soil.
The meeting, at CIA headquarters in Langley, Virginia, represented an attempt by both Panetta and the Pakistani spy chief, Lieutenant-General Ahmad Shuja Pasha, to repair the critical relationship between the two agencies, which had suffered serious strains over the last six months.
Officials indicated the meeting had gone well, though key issues remain unresolved.
"Director Panetta and General Pasha held productive discussions today and the CIA-ISI relationship remains on solid footing," Preston Golson, a CIA spokesman, told Reuters.
"The United States and Pakistan share a wide range of mutual interests and today's exchange emphasized the need to continue to work closely together, including on our common fight against terrorist networks that threaten both countries."
Privately, U.S. officials acknowledged that despite renewed goodwill, some Pakistani demands for greater scrutiny and control over CIA activities in Pakistan are unacceptable to the administration of President Barack Obama.
People familiar with the views of the Pakistani government said last month that, as part of a deal which resulted in the freeing of Raymond Davis, a CIA contract bodyguard who had been arrested on murder charges, the CIA agreed to cut back on U.S. spying in Pakistan.
The sources also said the CIA had agreed to give ISI more credit for its counter-terrorism efforts and to keep Pakistani authorities better informed of CIA activities.
MANY TOPICS UNDER DISCUSSION
Following Monday's meeting between the spy chiefs, a U.S. official said: "The Pakistanis have asked for more visibility into some things, and that request is being talked about -- along with a host of other topics, including ways to further expand the partnership."
But the official also said that while some Pakistani proposals were "under review," the Obama administration regarded others as "non-starters." The official declined to specify which Pakistani suggestions were likely to be rejected by Washington.
Beginning late last year, joint U.S.-Pakistani intelligence operations were disrupted by a series of disputes, most notably the Davis case in which the CIA contractor shot dead two Pakistanis in the eastern city of Lahore in January.
Pakistan held Davis in jail for weeks despite U.S. claims that he was protected by diplomatic immunity. He was released last month after the families of the men he shot were paid compensation, a custom in Pakistan and approved in Islam.
Ties were also strained when Pasha and other alleged ISI officers were named as defendants in a U.S. lawsuit filed by families of Americans killed in a 2008 attack by Pakistan-based militants on high-profile targets in Mumbai, India.
The lawsuits allege the ISI officers were involved with Lashkar-e-Taiba, an anti-India militant group, in planning and orchestrating the Mumbai attacks. Pakistan's government said it will "strongly contest" the case.
Shortly after the lawsuit was filed, Pakistani media named the undercover head of the CIA's Islamabad station, forcing him to leave the country.
The ISI offered no details on Pasha's Washington trip, which comes days after the Pakistani government extended his tenure as spy chief for a second time to ensure continuity.
Despite continuing difficulties, a U.S. official familiar with the high-level spy talks said: "The bottom line is that joint cooperation is essential to the security of the two nations. The stakes are too high."
(Editing by John O'Callaghan and Mohammad Zargham)