Prospect Theory: India’s Options After Pahalgam Massacre are Limited Even If Asymmetry of Power Puts Pakistan at Disadvantage

The horrific terror attack that claimed 26 lives a week ago in Pahalgam was another reminder that the Kashmir issue remains the primary issue in South Asia’s (and the world’s) oldest continuous conflict. India has been the victim of many terrorist incidents over the past three decades, the most notable of which was the Mumbai attacks of November 2008. Most of these attacks, especially those in Kashmir, have been with Pakistani complicity if not outright organization. The loud declarations in some quarters that there is no proof of Pakistani complicity is ridiculous since all evidence points to that state. Indian government has nothing to gain at this point from allowing (or for conspiracy theorists organizing) such an attack. Pakistani motivations for the attack can be attributed to the recent reduced tensions in the Indo-Pak conflict giving India a very prominent advantage — thanks to domestic political turmoil in Pakistan, and finally but most significantly, the lack of trust that Pakistanis have in their army.

Long History of Conflict

A quick background on the Kashmir issue is in order. The princely state of Kashmir (in colonial times) had a Hindu ruler but a majority of Muslim subjects. The state is easily trifurcated into a Hindu majority Jammu region, a Buddhist majority (but sparsely populated) Ladakh region, and the Muslim majority Kashmir valley (which is where the bulk of the kingdom’s population lived). 

At partition in 1947, unlike most other princely states, Kashmir was not within (and thereby dependent) either Indian or Pakistani territory, but adjacent to both states. It had an active and sizable popular political movement that opposed merger with Pakistan in the Jammu and Kashmir Conference (now National Conference), though another organization supported being part of Pakistan.  

All these reasons — the wishes of the king, the Conference, and the fact that Pakistani tribesmen supported by Pakistani armed forces invaded Kashmir — led India to send troops to stop a forced annexation and lay claim to Kashmir.  The first conflict ended in 1949 in a UN brokered ceasefire by which the state remained bifurcated into Indian and Pakistan administered Kashmir.  

India maintained Kashmir’s ad hoc status (to be settled permanently at some point) and allowed Article 370 – a law that forbade India from ethnically flooding the state – to remain in place.  The frozen conflict highlighted the raison d’etre of both states, India to underscore its secularism by having at least one Muslim-majority  within its dominion, and Pakistan needed it to justify its status as a Muslim haven in South Asia. The Pakistani demand for Kashmir manifested in the 1947, 1965, and 1999 wars but proved unsuccessful.  

Nuclear weapons introduced what is called the stability-instability paradox – stability at the international level, meaning no overt war, but instability through low-level conflict meaning terrorism.  Added to Kashmir is perhaps the identity dimension mentioned above – that Pakistan loses its reason for existence if a Muslim majority state can survive peacefully in India. It is with that backdrop that these terrorist incidents must be viewed: as weapons in an asymmetric war between a weak(ening) Pakistan and a (getting more) powerful India. 

Asymmetry of Power

But why now? Well, unlike the 1980s, the asymmetry between the two states is quite high now. The Indian rupee stands at 85 to the U.S. dollar while Pakistan’s rupee is at 281. India’s economy is much larger and more sophisticated while Pakistan is largely fueled by expatriate remittances which make up 10 percent of the economy. Moreover, in 2023, India’s GDP was estimated at $3.469 trillion, while Pakistan’s was $376.5 billion. Since the middle of the last decade Pakistan’s economy and polity both have suffered, and the country looks one step short of being a failed state. The Pakistani army, long revered as the only incorruptible and stable institution in Pakistan despite its anti-democratic tendencies, has also lost its sheen and is now viewed as a venal and self-serving institution. Considering all this the attack may be seen as a way for Pakistan’s army to seem relevant, to assure its citizens that the struggle to regain Kashmir is not over and that India’s machinations there will not go unanswered. 

Which brings up the question of what has happened at India’s end? India laid claim to Kashmir based on the erstwhile king’s decision to accede to India to seek help against Pakistani invaders, the fact that a major Muslim dominant Kashmiri organization did not want to join Pakistan but viewed India more favorably, and Kashmir’s strategic status adjacent to both countries (India and Pakistan) which rendered the simple partition logic of Muslim majority princely states joining Pakistan as moot. In quick order, India suppressed any dissent in Kashmir against joining India and formally annexed the state in 1964, despite maintaining the fiction of autonomy through a special status and Article 370. Later, it allowed the National Conference dominated by the Abdullahs (father, son, and grandson) to win elections conditionally and show local autonomy.

This state of affairs unraveled in 1987 when Kashmiris, fed up with internal corruption and external manipulation, embarked on  a series of violent protests which morphed into an insurgency. Pakistan, aided and abetted this upheaval which resulted in the ethnic cleansing of Hindus from Kashmir valley. The situation remained tense with periods of calm and violence alternating but peace has been maintained by the presence of upward of half a million Indian troops in the region – note, the Indian army has three Corps formations and one Army stationed here. 

The state of affairs unraveled in 1987 when Kashmiris, fed up with internal corruption and external manipulation, embarked on  a series of violent protests which morphed into an insurgency. Pakistan, aided and abetted this upheaval which resulted in the ethnic cleansing of Hindus from Kashmir valley.

In 2019, the BJP government of Narendra Modi took advantage of no government in power at the state level (the coalition had broken down) and declared Kashmir’s statehood over and its bifurcation into the Union Territories of Jammu and Kashmir and Ladakh. This was very unpopular in the region as it reduced the autonomy of the people further – a case in point is that the meeting held to discuss the terrorist attack in Pahalgam did not extend an invite to the Chief Minister of the union territory of Kashmir.

Where do the two countries go to from here? India has the upper hand, with a much larger economy and armed force as well as possessing the headwaters of the river Indus – the lifeline of Pakistan’s agriculture – and has threatened to abrogate the treaty which guarantees the water supply. It has also asked all Pakistani visitors and residents to leave India, and this has resulted in stories of many people who have long term visas being asked to leave their homes and get separated from their families. Pakistan has in turn threatened to undo all treaties including the Shimla Pact by which Indo-Pak differences were kept to a bilateral level and did not involve other countries. India views this as no loss given Pakistan’s frequent efforts to involve the U.S. and China. Besides, neither of those countries are interested in intervention.

India’s Options

India’s options are the following. One, air strikes against select Pakistani targets such as known camps of LeT (Lashkar-e-Tayeba) and other terrorist outfits. This, however, invites retaliation from Pakistan’s equally capable air force and risks escalation to a higher level. Besides, the last time India carried out strikes resulted in an Indian pilot being shot down in Pakistan and consequent humiliation. 

Two, India can attack select terrorists in Pakistan using proxies or its own secret service R&AW. This has been ongoing for the past five years and has proved to be successful in that it does not cause a major news splash but also sends a message to Pakistan’s army and ISI (Inter-Services Intelligence) that retaliation is assured.

Three, India can escalate militarily as it did after the Jammu attack of 2002 in which the two countries faced off to a possible war.  Other than escalation, India still loses more, since its economy is bigger and needs peace, not war tensions.

Doing nothing or going outright to war are not options for India. On one hand, it must prove that a strike against it cannot go unanswered, on the other hand, going to outright war can easily escalate into a nuclear conflict.  

Pakistan’s behavior is best explained by a framework called Prospect Theory in international relations. States’ leaders are either in a risk averse or risk acceptant mindset, based on their current circumstances. Pakistani leaders appear to be risk acceptant, since their economy and polity diverge increasingly from India in terms of capability and so the future looks to be one of loss. Striking now to retard India’s confidence and assurance in Kashmir might be worth it if it pays off. India’s leadership has generally been risk averse as it is a steadily growing economy and the future looks promising and so war is a last resort.

A further problem in Pakistan is that the removal of populist (and very popular) leader Imran Khan has made the army unpopular as it is seen as stopping the democratic process and the will of the people. The end of armed confrontation with India  for a long time means that the army is not seen as functioning in its role as Pakistan’s savior.  It is possible therefore that this attack went ahead with the twin objectives of showing support for Kashmir as well as underlining the relevance of the army.

One final thought is related to the domestic (Kashmiri) help that would have to be given to the attackers (presumed largely Pakistani at this point) for success. This has been a critical issue and has led to much name calling of Kashmiris and Muslims in India. However, removing statehood from a people will never result in their quiescence but rather a desire to revert to the past status. In order to find lasting peace the Indian government must restore Kashmir’s status to statehood and offer enough carrots to make being part of India attractive. Carrots are the answer, not sticks. As regards Pakistan, while tragic, such attacks are rarer now and a testament to the great divide between the two South Asian neighbors that were once hyphenated. That divide looks to increase over time.

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Milind Thakar is Professor and Graduate Director of International Relations at the University of Indianapolis.