Police in the province of Jharkand said Thursday (March 1st) that they have arrested a suspected Lashkar-e-Tayaba (LeT) operative and are planning to hand him over to their counterparts in New Delhi, who are investigating an alleged terror plot in the capital.

Taufeek Ahmed Peer, 20, is the third suspect to be arrested.

"They were planning to detonate a bomb or more than one bomb in a crowded locality," Home Minister P. Chidambaram told reporters on Wednesday.

The two other suspects, identified by police by the names Shafaqat and Ethisham, were both nabbed in Delhi following a tip-off from intelligence agencies. Ethisham and Peer are said to be cousins.

According to police, the pair arrested in the capital were carrying sulphuric acid, out of which improvised explosive devices can be made. The authorities also recovered memory cards containing information on LeT training camps.

"One of the terrorists was in Pakistan last December and returned in January this year with an objective to carry out bomb attacks in crowded places," Delhi Police's Special Cell commissioner, P.N. Aggarwal, told Khabar South Asia.

While many details about the alleged militants and their motives remain unclear, the timing suggests that LeT is reacting to the recent warming of ties between Delhi and Islamabad, analysts say.

Historically, tensions have been high between the two neighbours, with their ongoing disputes erupting into outright war in 1947-48, 1965 and 1971.

But relations have thawed over the past weeks. On Wednesday, Pakistan announced plans to eliminate key restrictions on Indian imports by the end of 2012, in preparation for granting India Most Favoured Nation trade status.

Experts say the warming trend could pose a major threat to LeT if Delhi and Islamabad begin to co-operate in rooting out extremists.

"There is an increased feeling of trust and it is the right time to put a joint strategy in place to counter terrorism," Indian External Affairs Minister S M Krishna told Khabar.

The disputed territory of Kashmir, historically a breeding ground for extremism, has been largely tranquil in recent months, prompting the government in Delhi to declare some districts "militant-free". A recent survey by the Institute for Research on India and International Studies (IRIS) found that Kashmiri youth are increasingly less inclined to support militant groups and more attracted to peace.

Meanwhile, Pakistan has told leaders of the separatist All Parties Hurriyat Conference that Islamabad is seeking a non-violent resolution to the decades-old quarrel.

"What is interesting is that Pakistan has agreed to shelve the Kashmir issue for the time being and has made its intentions clear to the Hurriyat chief. In fact, the country has even proposed a peace plan," M.L. Koul, a professor and Kasmir expert, told Khabar.

New Delhi has long accused its neighbour of abetting LeT terrorists seeking to carry out attacks on Indian soil. But Pakistan, struggling to emerge from a socio-economic crisis and internal political disarray, "is in no way in the mood to support LeT right now," said security analyst and retired Commander-in-Chief of Indian Strategic Forces Command Vijay Shankar.

While declining to comment on the foiled attack in Delhi, the Pakistan's foreign ministry told journalists Thursday that the country "condemns terrorism in all its forms and manifestations, and itself has suffered a lot" due to extremists.

Busting the alleged terrorist plot could be a major morale-boost for India's police and intelligence services, which have often come under fire for being unable to prevent such attacks.

With police services from Delhi and the provinces of Jharkand and Kashmir working together and in consultation with intelligence services, local media point to the sting as having been smoothly co-ordinated.