US Assistant Defence Secretary Peter Levoy is returning to Islamabad next week to lead the American team which is negotiating a resolution to the Nato routes dispute with Pakistan, diplomatic sources told Dawn.

Mr Levoy, who looks after Asia and Pacific security affairs at the Pentagon, led the US contingent at an April 26 meeting with Foreign Minister Hina Rabbani Khar in Islamabad as well. The US media reported later that Mr Levoy and his team left the meeting abruptly because of certain remarks made by the foreign minister.

The remarks, according to the media reports, were linked to Pakistan’s demand for an apology from the United States over the Nov 26 air raid that killed 24 Pakistani soldiers and prodded Islamabad to close Nato supply routes to Afghanistan.

Since then Pakistan has stopped insisting on an apology as a precondition for reopening the routes. The concession enabled President Asif Ali Zardari to attend the May 20-21 Nato summit in Chicago but his inability to resolve the route dispute further complicated already tense relations between the two countries.

The two sides resumed their contacts after Mr Zardari returned home and because of the bitterness created by the April 26 incident at the Pakistan Foreign Office, this time Islamabad allowed its embassy in Washington to play a lead role in the talks.

The two sides are now working on a compromise formula to resolve the supply routes dispute which will require the United States to rebuild the highways damaged by Nato convoys.

In return, Pakistan will drastically reduce its demand for an increase in charges for overland deliveries of US military supplies to Afghanistan.