This chapter investigates current security and economic interactions between India and Pakistan, assuming that Kashmir imbroglio is far more than a territorial and ideologically constructed tussle, it is a multi-dimensional conflict, which results in multiple socio-economic and geostrategic challenges. Selected evolving security-related and economic aspects are addressed with the supposition that the 2020s are likely to be marked by intensified competition between the United States and China, with possible contribution to shaping South Asian strategic dynamics. Other actors, such as the Gulf states, may also influence Indo-Pakistani interactions.

Political and strategic confrontation determines and adversely affects Indo-Pakistani trade relations. India and Pakistan account for most of the region's gross domestic product (GDP), 80% of South Asia's surface area and 85% of its population, yet, due to the protracted hostility, bilateral trade exchange, which would be beneficial to both sides, is largely limited and it depends heavily on current bilateral relations. The upsetting data regarding economic relations is a consequence of a decades-long process of negligence, mistrust, Pakistan's apprehensions regarding India's economic regional domination and lack of will to improve economic cooperation between the two states.