Core issue
A Cisco router that runs Next Hop Resolution Protocol (NHRP) over Multipoint GRE (mGRE) tunnels may report this error upon receiving an NHRP Receive Resolution Reply packet:
In the process switching path, NHRP also attempts to look-up a cache entry for the real destination prefix, instead of the next-hop IP address for that prefix in its global routing table. When NHRP performs such a look-up for a host prefix (/32), it fails to find a match, even if a less specific network cache entry does exist. This event results in the %NHRP-3-PAKREPLY message being displayed to the console.
Resolution
This issue is discussed in Cisco bug IDs CSCdt23105 and CSCeb24211
As a workaround perform these commands in the router.
buffers middle permanent 60
buffers middle max-free 300
buffers middle min-free 30
For more information ,refer to Network Management Commands and Buffer Tuning for all Cisco Routers
Also as a workaround in this scenario you can use Cisco Express Forwarding (CEF). For more information, refer to the ip cef command.
Problem Type
Troubleshoot software featureProduct Family
Firewall - IOS firewall
Routers
Frequency
ContinuouslyError
%NHRP-3-PAKREPLY: Receive Resolution Reply packet with error - insufficient resources Cisco IOS Software Version
12.1VPN Protocols
IPSecBug ID
Bug ID not listed