Commenting on a Washington Post report that Pakistan was preparing to deploy nuclear weapons against India during the 1999 clashes in Kashmir, the officials said they were unable to confirm "this particular piece of information."
"But we were aware that both sides were planning for the possibility of hostility spreading beyond Kashmir," said one official who did not want to be identified.
A Himalayan valley, Kashmir has been disputed between India and Pakistan since 1947 and has already caused two wars between the countries. Two-thirds of the valley belongs to India and one-third to Pakistan.
"The situation is tense again, with both sides spreading their troops along their international border and along the line of control in Kashmir," the U.S. official said.
Reacting to a terrorist attack on the Indian parliament on Dec. 13 that killed 14 people, India deployed hundreds of thousands of troops along the border. Later it announced that it was also deploying nuclear-capable Prithivi missiles.
Pakistan has responded by mobilizing its own troops, causing fears of yet another conflict in the region.
According to the Post, National Security Council Senior Director Bruce O. Riedel said in an article he wrote for Center for the Advanced Study of India at the University of Pennsylvania that President Clinton confronted Pakistani Prime Minister Nawaz Sharif with the information during an emergency meeting in Washington on the Fourth of July, 1999.
"Clinton asked Sharif if he knew how advanced the threat of nuclear war really was and did Sharif know that his military was preparing their nuclear-tipped missiles? Sharif seemed taken aback and said only that India was probably doing the same," Riedel said. "The president reminded Sharif how close the U.S. and Soviet Union had come to nuclear war in 1962 over Cuba. Did Sharif realize that if even one bomb was dropped ... Sharif finished his sentence and said it would be a catastrophe."
Other Clinton advisers confirmed the account of the intelligence that was obtained as India battled Pakistani-backed rebels in the mountainous Kargil region of Kashmir.
One former official said the United States learned that Pakistan was moving its intermediate-range, nuclear-capable Ghauri missiles out of storage and to new locations. He said the movement might have been offensive in nature or might have been a move to disperse the missiles as a precaution against a preemptive Indian strike.
Nevertheless, the White House was faced with the distinct possibility that nuclear missiles could be launched, possibly against heavily populated Indian cities such as Bombay.
"It was certainly enough for us to take it very seriously," Strobe Talbott, former deputy secretary of state, told the Post. He added that the Kargil crisis "had the potential of going all the way."
Sharif was overthrown in a military coup three months later, but tensions continue between Pakistan and India, which also has the bomb.
Assistant Secretary of State Christina Rocca has been in India this week in an attempt to defuse the latest crisis between the two countries, which began with an attack by rebels on the Indian Parliament in December and continued this week with a rebel assault on a bus and army camp in Kashmir that left 30 dead.
"Clearly, tensions are increasing as a result of the latest incident in Kashmir," said Karl Inderfurth, assistant secretary of state for South Asian affairs under Clinton. "Another spark could be set off, and this could become even more dangerous than Kargil if this is not resolved soon."