Pagination issue for Custom Post type in wordpress 3.0

This is my portfolio page code, please help if any one have an idea what goes wrong.


<?php 
/* Template Name: Portfolio  page */
get_header(); ?>
<?php $loop = new WP_Query(array('post_type' => 'portfolio', 'orderby'=> 'menu_order', 'paged'=>$paged, 'posts_per_page' =>2)); ?> <?php while ( $loop->have_posts() ) : $loop->the_post(); ?>
  • <?php the_title(); ?>

    <?php the_post_thumbnail(); ?> <?php $img=get_post_meta($post->ID, 'Image', true); $timthumboption = get_option("timthumboption"); ?> <?php if($img) { ?> <?php if( $timthumboption == "0" ){?> <?php the_title(); ?> <?php } ?> <?php if( $timthumboption == "1" ){?> <?php the_title(); ?> <?php }?> <?php } else { ?> no image <?php } ?>

    <?php the_content_rss('', TRUE, '', 20); ?> view more
<?php endwhile; ?>
<?php next_posts_link('« Older Entries') ?>
<?php previous_posts_link('Newer Entries »') ?>
<?php get_footer(); ?>