However, the trip may be rescheduled next year, close Clinton aides told The Washington Post.

There is ``progress'' on several key issues, including talks between India and Pakistan on Kashmir and the Comprehensive Test Ban Treaty (CTBT), but ``not enough'' to warrant a Presidential trip, they said.

The decision, they said, came after Clinton concluded that the two nations ``had not done enough to rein in their nuclear arms race after their spring tests.''

Aides said, ``Clinton would reschedule his visit to the next year after more work on regional tensions such as the dispute over Kashmir and non-proliferation issues, including controlling missile deployment, technology exports and production of fissile materials used for nuclear weapons.''

But, the officials, did not indicate what kindof ``more work'' they envisage for the US on these issues.

White House press secretary Mike Mccurry said yesterday he did not have any reason to dispute press reports that President Clinton's visit to South Asia was being deferred. ``But when we have an official announcement to that effect, I'll make it,'' he said.

Earlier today, US Ambassador to Bangladesh John Holzman, quoted Clinton as saying he postponed the trip ``as consultations with India and Pakistan have not reached a point where a visit to the region would be most productive.''

``Progress is being made at the talks with these countries and I, hope circumstances, will permit me to reschedule my visit to the region next year,'' Holzman quoted Clinton as saying in a letter to Premier Sheikh Hasina, expressing inability to visit Bangladesh.

US officials moving quickly to control the fall-out of the decision said, ``This isn't cancellation as punishment; this is postponement because of progress. We have to have more time to lower tensionssignificantly. We just don't have that between now and November.''

Defending the decision, a senior official said, ``You don't want to look like you are doing anything that rewards them for breaking out of the international arms control regime. But at the same time, you want a Presidential visit to coax the non-proliferation agenda ahead.''

Dubbing the move as a ``setback'' to efforts to improve ties with sub-continent, The Post, noted Prime Minister Atal Behari Vajpayee's remarks to the UN in which he lashed out at the US for its ``reluctance to accept India as a responsible member of the international community.''

Meanwhile, Pakistan has expressed ``disappointment'' over the move. ``Pakistan was eagerly awaiting President Clinton's visit. We hope he will be able to visit us at the first available opportunity,'' a Pakistan embassy spokesman said in Washington.