Next Page Links Go To Home Page

I’m trying to get a new theme for my blog working, the new them initially did not come with any “next page” links at the bottom of the screen. I used the following code:

<div class=”navigation”>
<div class=”alignleft”><?php next_posts_link(‘« Older Entries’) ?></div>
<div class=”alignright”><?php previous_posts_link(‘Newer Entries »’) ?></div>
</div>

This made the links appear however each time I click the link it takes me back to the main page. I have not set a static front page from the wp-admin dashboard, here’s my the original code for my index:

http://pastebin.com/de978744