Cause of three wars between India and Pakistan, Kashmir continues to be the bone of contention. Separatists backed by Pakistan began insurgency against India in 1989 and tens of thousands of people have been killed since. Huge resources have thus been spent on the area to counter insurgency. A November 2003 truce has largely held along the so-called Line of Control dividing Kashmir, despite occasional clashes. Even though former president General Musharraf offered a plebiscite, the deadlock still continues
Afghanistan has become a major source of friction as the two countries have long competed for influence in the landlocked nation and Pakistan is deeply suspicious of a rise in India’s presence after the fall of the Taliban in 2001. It accuses India of using Afghanistan as a base to create problems inside Pakistan, including backing separatists in its Baluchistan province. India denies the accusations, saying its focus is on development.
A sensitive national security issue - terrorism (often represented in context of Mumbai 26/11 carnage which killed 166 people) has become another matter which refuses to die down. India has refused to resume a series of talks on other problems until Pakistan takes more action against Pakistanbased militant groups. Indian diplomats have often said that their concerns about militants in Pakistan would form the main focus of the talks.
The two countries disagree over use of the water flowing down rivers which rise in Indian Kashmir and run into the Indus river basin in Pakistan. The use of the river water is governed by the 1960 Indus Water Treaty under which India was granted the use of water from three eastern rivers (Ravi, Beas and Sutlej) and Pakistan the use of three western rivers (Indus, Chenab and Jhelum). Pakistan says India is unfairly diverting its waters with the upstream construction of barrages and dams. Pakistan, dependent on the water to produce food for its growing population and underpin its economy, wants to it at the top of the table. However, India denies any unfair diversion of Pakistani water. Siachen Indian and Pakistani forces are faced off across the Siachen glacier in the Himalayas, known as the world’s highest battlefield at 5,500 metres (18,000 feet) above sea level, since 1984. The two sides have been trying to find a solution that would allow them to withdraw troops but India says it is unwilling to bring its forces down until Pakistan officially authenticates the positions they hold. Pakistan has said it is willing to do so but on the condition that it is not a final endorsement of India’s claim over the glacier.
Another boundary dispute is over the 100-km Sir Creek estuary flowing into the Arabian Sea. The problem has hampered exploration of oil and gas and led to the detention of hundreds of fishermen from the two countries, mostly in areas where demarcation is still unclear