Pakistan still believes that India poses 'existential threat' to them, even as the US has been pulling them closer to the view that the terrorism is the greater danger to it, a top American commander has said.

"They still believe that India poses their greatest existential threat, although we've been pulling them closer to our view, which would suggest that terrorism is as much a threat to them as it is to us," General Martin Dempsey, chairman of the US Joint Chiefs of Staff told PBS news.

General Ashfaq Pervez Kayani has got some internal issues which he has to manage politically, Dempsey said.

"I mean you've seen the same reports as I have about their internal domestic politics, and it's challenging, and so yeah I do think that General Kayani, when we have our conversations, I think that he will do what he can, which may never be what we would like," he said responding to questions.

Dempsey revealed that Kayani was his classmate in a US military school. Kayani, he said, was very upset when he found out that al-Qaeda chief Osama bin Laden was on Pakistani territory and had been killed by American forces.

"That doesn't mean that there may not have been others in the country that were...but we have, from my personal understanding, have never found any evidence to that, that there would be some who were...it. It's just hard to believe," he said.

"Yeah, hard to believe that somebody didn't know," he added. The top American General said he believes that Pakistan is stable today.

"I do think there are some trend lines that would be concerning for both them and us in terms of migration of various terrorist groups. And again, I think their economic forecast is what probably gives me the greatest cause for concern," he said.

"I mean from -- and certainly -- and my understanding of the term dire, it's a fairly dire economic conditions. And of course, that exacerbates some of the problems they have with the extraordinary large population that is growing rapidly and elements of religious extremism operating in parts of the country. So thread all that altogether, it does make for a very challenging future," he said.

Dempsey said Pakistan needs to do more in this war against terrorism. "Were we ever to our satisfaction find that the Afghan safe haven for terrorist groups is reduced to our satisfaction, and the answer is probably not. Part of that may be Pakistani will, I mean, that's to be determined. Part of it is probably they're capability. Again, that's a very long stretch of what has traditionally been lawlessness. I believe they will do the best they can but it may not be enough for us," he said.

Acknowledging that the relationship between the two countries has been a challenging one, he said the leaders of the US and Pakistan have been in conversation with each other.

"We have been in conversations about our mil to mil relationship, about our foreign military sales, about some of the common challenges of terrorism, and they have asked to be given time in their parliamentary process to have some internal discussions about what the new relationship might be, but I'm personally optimistic that we can reset the relationship in a way that meets both of our needs," he said. He hoped that Pakistan would be able to take action against the Haqqani network.