Washington: The US would like to see improved relations between Pakistan and India and that is why President Donald Trump offered his "assistance" to resolve the Kashmir issue, a senior State Department official said on Thursday.

The official, on the condition of anonymity, was responding to a question on the position of the US on the Kashmir issue after Trump last week offered to be the "mediator" between India and Pakistan on the issue during his meeting with Pakistan Prime Minister Imran Khan at the White House.

India firmly rejected Trump's offer, saying that New Delhi's consistent position has been that all outstanding issues with Pakistan are discussed only bilaterally.

"On Kashmir as I said, we would all like to see improved relations between India and Pakistan. That''s why you heard the president''s offer of assistance," the official said.

"We recognise that Kashmir has been a bilateral issue but there are opportunities as Pakistan takes steps that build confidence in its own efforts to counter terrorism for their ultimately towards a constructive dialogue. We stand ready to assist if asked by the parties to do so," the official said.

An influential Democratic Congressman apologised to India's US envoy for President Donald Trump's "embarrassing" remarks on Kashmir, while several others came out in support of New Delhi's established stand against any third-party role on the issue.

"I just apologised to Indian Ambassador Harsh Shringla for Trump's amateurish and embarrassing mistake," Congressman Brad Sherman tweeted hours after Donald Trump's stunning claim that Prime Minister Narendra Modi sought his mediation or arbitration efforts to resolve the Kashmir issue.

A day after President Trump’s offer to be the "mediator" between India and Pakistan on the Kashmir issue took everyone aback, his chief economic advisor Larry Kudlow has stated that US President Donald Trump "does not make up things".

Larry Kudlow, one of Trump’s top advisers said that when asked about his stunning claim that Prime Minister Narendra Modi had asked him to "mediate" on the Kashmir issue. India has strongly rejected that claim.

It is "a very rude question," Donald Trump's chief economic advisor Larry Kudlow told reporters at the White House on Tuesday when a journalist asked if the remarks were made up. "The President doesn't make things up," Kudlow said.