Pakistan on Tuesday decided to boycott a key international conference on Afghanistan on December, widening its protest over lethal cross-border NATO strikes and exacerbating a deep crisis in US ties.

The Pakistani cabinet took the decision at a meeting in the eastern city of Lahore, just days after Islamabad confirmed it was mulling its attendance in the German city of Bonn, where Pakistan was considered a key player.

"The cabinet has decided not to attend the Bonn meeting," a government official told the media on condition of anonymity. Tuesday's talks also decided to call a joint session of parliament to discuss the fallout.

The cabinet branded ‘unilateral action’ such as Saturday's NATO strike and the May 2 US killing of Osama bin Laden, which brought the US relationship to its lowest level in years, ‘unacceptable’, the prime minister's office said.

Pakistan has already closed the Afghan border to NATO convoys, a lifeline for 140,000 foreign troops in Afghanistan, ordered American personnel to vacate an air base reportedly used by CIA drones and ordered a review of the alliance.

Although international conferences on Afghanistan are criticised for lacking substance, Pakistan's snub of the donors' meeting would be symbolic given how closely Islamabad is linked to the conflict and any eventual resolution.

"It is a way to build pressure to make the United States understand that Pakistan takes this very seriously," political analyst Hasan Askari told the media.

"It is registering its resentment with the international community."

US-Pakistani ties have been in free fall since a CIA contractor killed two Pakistanis in Lahore in January. On Saturday's attack raises disturbing questions about the extent to which the two terror allies can cooperate with each other.

US General Martin Dempsey, the top US military officer, told Britain's ITV News that Pakistani-US relations were ‘on about as rocky a road’ as ever.

"It's had its rocky moments in the past. This one certainly is more serious than any I've been involved with and I've been working issues with Pakistan for the last 10 years," he told the network late Monday.

He described the deaths of 24 Pakistani soldiers in NATO firing near the border with Afghanistan as tragic, but when asked if the United States had nothing to apologise for he said: "No, I don't know enough about the incident."

The US military has given investigators until December 23 to probe the attack, threatening to prolong significantly Pakistan's blockade.

Brigadier General Stephen Clark, a one-star air force general based in Florida, is to lead the investigation.

The team, to include a NATO representative, is yet to arrive in Afghanistan but an initial military assessment team has already been to the border.

The Afghan and Pakistani governments are also being invited to take part. There was no immediate reaction from Islamabad or Kabul, although some analysts voiced surprise that it will take as long as nearly four weeks.

A Western military official in Kabul said the schedule for the findings being delivered was ‘way quicker’ than initially expected.

Islamabad insists that the air strike was unprovoked, but Afghan and Western officials have reportedly accused Pakistani forces of firing first.

Angry protests over the NATO attack pushed into a fourth day, with 150-200 people demonstrating in Pakistani-administered Kashmir, setting fire to an American flag and an effigy of NATO chief Anders Fogh Rasmussen.

The crowd carried banners and shouted: ‘Those who befriend America are traitors’ and ‘We are ready for jihad’, media reporter said.

Yet behind the rhetoric, Islamabad has little wriggle room, being dependent on US aid dollars and fearful of the repercussions for regional security as American troops wind down their presence in Afghanistan in the coming years.

In an interview with CNN, Pakistan Prime Minister Yousuf Raza Gilani said the US alliance could continue based on ‘mutual respect and mutual interest’.

Last time Pakistan closed the border, in September 2010 after up to three soldiers were killed in a similar cross-border raid, it only reopened the route after the United States issued a full apology.

Nearly half of all cargo bound for NATO-led troops runs through Pakistan. The roughly 140,000 foreign troops, including about 97,000 American forces, rely on supplies from the outside to fight the 10-year war in Afghanistan.