India Suspends Indus Waters Treaty After Kashmir Attack

On April 22, 2025, militants attacked a convoy of buses carrying tourists in Pahalgam, a popular resort town in Indian-administered Kashmir. The assault killed 28 civilians and injured 17, making it the deadliest attack in the region in over a decade. The Resistance Front (TRF), a militant group with alleged links to Lashkar-e-Taiba and safe havens in Pakistan, claimed responsibility. The group cited opposition to the Indian government’s demographic changes in Kashmir, following the 2019 revocation of Article 370, which removed the region’s autonomy and opened it to non-local settlement.


In a sharp retaliatory move, India suspended the Indus Waters Treaty (IWT)—a landmark 1960 agreement brokered by the World Bank that governs water-sharing from six rivers between India and Pakistan. The treaty has been a cornerstone of India-Pakistan relations, surviving multiple wars. India also shut down the Attari-Wagah land border, expelled Pakistani diplomats, and canceled all Pakistani visas. Pakistan condemned the attack but rejected blame, threatening “comprehensive retaliation” for what it called unilateral and illegal measures. These developments sharply raise the risk of regional escalation, with global powers calling for restraint as a deepening security and water conflict looms in South Asia.

Political Effects

Financial Effects

Economic Effects

Political Effects

Financial Effects

Economic Effects

Long-Term Effects


Fundamental Shift in India-Pakistan Relations: The suspension of the IWT, a treaty that survived decades of conflict, could permanently alter the basis of India-Pakistan relations, moving from a fragile coexistence managed by agreements towards a more confrontational stance where vital resources like water become tools of statecraft. This increases the baseline risk of future crises and limits the potential for broader engagement on issues like trade or counter-terrorism.


Escalating Water Scarcity and Conflict Risk: The breakdown of the IWT framework could lead to unchecked upstream development by India and increased water insecurity downstream in Pakistan, potentially devastating its agriculture and economy. This scarcity could fuel internal instability in Pakistan and become a persistent source of bilateral military and political tension, potentially escalating into conflict, especially during periods of drought or high demand.  


Entrenched Regional Instability and Militarization: The diplomatic freeze, coupled with heightened security operations and border closures, points towards a sustained period of high alert and increased military posturing along the border and within Kashmir. This could lead to a more militarized environment in the region, diverting resources, hindering development, and perpetuating a cycle of violence and retaliation.


Increased Domestic Political Polarization: The crisis is likely to reinforce nationalist narratives in both India and Pakistan. In India, there may be continued public pressure for hardline policies in Kashmir and towards Pakistan. In Pakistan, the government could face persistent pressure to respond forcefully to perceived Indian aggression, potentially limiting space for diplomatic de-escalation and exacerbating internal political challenges.


Key Data


  • 39 billion cubic meters: Annual water affected by the Indus Waters Treaty.

  • $30 million+: Estimated tourism losses in Kashmir this season.

  • 5,000: Additional Indian troops deployed to Kashmir.

  • $7 million/day: Estimated value of halted trade at the Attari-Wagah border.

  • 2019: India revoked Article 370, ending Kashmir’s special status.

  • 1960: Year the Indus Waters Treaty was signed, brokered by the World Bank.

Thursday, April 24, 2025