Deep Dive
Shownotes Transcript
You're listening to an iHeart Podcast. Hiscox Small Business Insurance knows there is no business like your business. Across America, over 600,000 small businesses, from accountants and architects to photographers and yoga instructors, look to Hiscox Insurance for protection. Find flexible coverage that adapts to the needs of your small business with a fast, easy online quote at Hiscox.com. That's H-I-S-C-O-X dot com.
There's no business like small business. Hiscox Small Business Insurance. Switch to Verizon Business and get more from your internet without paying more for your internet. Get LTE Business Internet starting at $39 a month when paired with select business mobile plans. That's unlimited data.
Bloomberg Audio Studios. Podcasts. Radio. News. Radio. News.
Tensions between India and Pakistan that threatened to boil over during the weekend have now settled back to a simmer. The two countries have been striking at targets inside each other's borders since last Wednesday. It's the worst fighting between these two nuclear powers in half a century. But now they appear to have reached a fragile truce.
So what you saw with this conflict was really the closest that India and Pakistan have come to an all-out war since possibly the 1970s. Dan Strumpf is a Bloomberg senior reporter based in India's capital of New Delhi. He says the hostilities are the latest phase of a long-standing territorial dispute —
over the border region of Jammu and Kashmir. It's one of the most contested regions in the world, really. Both India and Pakistan have claimed this region as their own, going back to the time of independence. But what might look to outsiders like a regional issue has serious international implications. Both India and Pakistan are nuclear powers. India is one of the world's largest economies and the most populous.
Then there's China, which has been working to grow its influence in the region. These factors appear to have drawn in the Trump administration. U.S. President Donald Trump surprised the world by announcing a ceasefire in a social media post over the weekend.
But not everyone's happy about that. The surprise announcement may have upstaged Indian Prime Minister Narendra Modi. There's a real sort of sense of dismay and anger that you see among Indian politicians and ordinary Indians as well. This really throws a wrench in Modi's political standing right now in India.
Welcome to the Big Tech Asia from Bloomberg News. I'm Wanha. Every week, we take you inside some of the world's biggest and most powerful economies and the markets, tycoons, and businesses that drive this ever-shifting region. Today on the show, a conversation between Rebecca Chung Wilkins and Bloomberg reporter Dan Strumpf.
about the increasingly intense conflict between India and Pakistan, how the conflict changed in recent days, and the roles the U.S. and China have been playing in the background. ♪
India said that it has conducted military strikes in Pakistan and Pakistan on the other hand said they have downed five Indian fighter jet planes and this is an escalation of the two nuclear armed nations. The tensions have been simmering for the last few days ever since 26 people were killed. Dan, hello. It's been a very busy few weeks for you. It's been very busy for all of us here in India and Pakistan. And...
I want to get straight into the conflict and what's been keeping you so busy. So the current conflict goes back about three weeks on April 22nd to a terrible attack that took place in Indian-administered Kashmir in a region known as Pahalgam, India.
which is a sort of beautiful mountainous meadow region in Kashmir. A large group of tourists were vacationing in the meadow and armed gunmen came out of the forest and gunned down 26 people.
All of them were civilians, mostly tourists, mostly Indians. So in the immediate aftermath of this event, India very quickly blamed Pakistan for the disaster in Kashmir. Pakistan very quickly denied any involvement.
And where exactly is Kashmir? Because the geography really matters in this case. The geography does really matter. So Kashmir is a large region that sits on the northern tip of India bordering Pakistan. And it's about the size of the UK. It's one of the most contested regions in the world, really. Both India and Pakistan have claimed this region as their own going back to the time of independence.
And Dan, how did Kashmir become so contentious between India and Pakistan? So the conflict essentially dates back to the independence of both countries from the British in 1947. The British colonial administration essentially left the region in a hurry, leaving a whole host of territorial disputes unresolved.
And the most fraught dispute of all came to be Kashmir. And Kashmir became the sort of touching off point for the very first war that the two countries fought immediately after independence. And it's been a source of multiple wars over the years ever since. How did we see the two sides respond in the immediate aftermath of this event?
So it was about two weeks of posturing. Nothing really happened until about a week ago when India announced that it had undertaken a series of airstrikes on the Pakistani side of Kashmir. Pakistan responded with its own strikes. The two sides traded artillery fire, small arms fire, and eventually missile fire and
And drone and aircraft attacks were involved as well on both sides. Right. So that was the military response we've seen from the two sides. Were there any changes in terms of diplomacy and policymaking? So in addition to military strikes, India suspended what's known as the Indus Waters Treaty, which is a treaty that essentially governs the use of the Indus River and Indus
its vast number of tributaries. It's so essential to both of these countries, their reliance on the water that comes from this vast sort of river basin. After India suspended this treaty, that really raised the fears that the flow of water from India to Pakistan, which lies downstream from India, could be under threat. And what Pakistan said very quickly after the suspension of this treaty was that
If its water flow is threatened, it would treat that as an act of war. You mentioned that Kashmir is a region no stranger to conflicts and skirmishes. So we've seen violence throughout the 2000s and further escalations in 2019. How is this time different from what we've seen in the past? I think it's important first to point out that what we saw in the last week or so was
is far from the sort of full-blown wars that defined the conflicts that took place in the last century over Kashmir. What we saw was a major escalation in violence in comparison to what we've seen in recent decades.
This conflict hit much closer to populated civilian areas, hit much closer to some of the locations of some of the highest levels of government, at least on the Pakistani side, on the military side. You saw air skirmishes taking place outside of Kashmir along the conventional border between Pakistan and India. You saw artillery fire traded on both sides.
You saw the introduction of new types of weaponry, things like kamikaze drones. Chinese made fighter jets on the Pakistani side. French made fighter jets on the Indian side. What several people have told us is essentially this conflict resets the rules of the game. It expands the theater around which future conflicts might take place.
and also expands the range of weaponry that might be involved. Now tell us about the ceasefire. When did it happen and how was it actually reached? So this ceasefire, as we know, it came together over really just the course of a few hours of phone calls starting from the White House on Friday and Saturday and into the weekend.
And those phone calls took place between Marco Rubio and Vice President J.D. Vance and a number of high-level players on both the Indian and Pakistani side. What took everybody by surprise was Trump's post on Truth Social on Saturday morning in Washington, Saturday afternoon here, announcing that a ceasefire had taken place and it was a done deal.
After the break, Rebecca and Dan talk about India's reaction to the truce and to Trump's announcement and what role China is playing in this conflict. Thrivent can help you plan your finances for the people, causes and community you love. What makes Thrivent different? Financial services and generosity programs are combined to help you build a financial roadmap for the future while also creating opportunities to give back along the way. Visit Thrivent.com to learn more. Thrivent.
Thrivent, where money means more. Hiscox Small Business Insurance knows there is no business like your business. Across America, over 600,000 small businesses, from accountants and architects to photographers and yoga instructors, look to Hiscox Insurance for protection. Find flexible coverage that adapts to the needs of your small business with a fast, easy online quote at Hiscox.com. That's H-I-S-C-O-X dot com.
There's no business like small business. Hiscox Small Business Insurance. India and Pakistan aren't the only countries disputing control of Kashmir. China claims a part of the region as well. And as the conflict between India and Pakistan unfolded, in the back of everyone's minds have been the ongoing trade negotiations that both China and India are conducting with the U.S.,
Meanwhile, the U.S. approach to the tensions between India and Pakistan has been inconsistent. Last week, Vice President J.D. Vance told Fox News that the conflict was, quote, fundamentally none of our business. Then Trump surprised everyone over the weekend by announcing a ceasefire on social media. Rebecca Chung Wilkins asked Bloomberg's Dan Strumpf how each side is reacting to foreign intervention.
Each side views the prospect of foreign intervention in this conflict a little bit differently. On the Indian side, there has been a very deep-seated resistance to any foreign intervention in the Kashmir conflict.
India views this conflict as an issue between Pakistan and India to be sorted out bilaterally. And this is a position that goes back decades now. And that in some part is because India has viewed foreign intervention and foreign mediation in this conflict as being something that might be sympathetic to Pakistan.
I think the Indian side is finding it hard to not see this as having lost some ground in a way by essentially being backed into accepting some kind of US role in any kind of ceasefire that is now taking hold. So in that sense, there's a real sense of dismay and anger that you see among Indian politicians and
ordinary Indians as well. And conversely, how is the US's involvement viewed by Pakistan? Now, Pakistan, of course, has taken the opposite perspective. It wants foreign intervention in this conflict. It wants foreign brokerage and foreign mediation and has sought as much in various forums around the world, including the United Nation, the Organization of Islamic
cooperation, and directly appealing to third party countries as well for mediation in this conflict. There's a real sense of jubilation and that by bringing in a third party like the United States to broker a ceasefire, that this is a real victory for Pakistan and now the two sides
have future issues to discuss, and there's going to be third parties mediating and potentially laying a roadmap for conversations that could take place over
Well, who knows how long. Now, one of the reasons why the U.S. felt like they had to intervene was because they were worried that things could take a turn for the worse if neither side ended up de-escalating. Can you tell us why the U.S. was so concerned about a full-scale war breaking out in this part of the world?
So this conflict for decades now has taken place against the backdrop of possible nuclear weapons use. Both countries have nuclear weapons. India maintains a no first strike rule. Pakistan is ambiguous on how it might or might not use nuclear weapons. At the same time, is a very strong incentive for neither country to push the conflict too far.
It's also a reason why you do see foreign powers who might not otherwise be welcome or have any business in this conflict stick their nose in like we just saw in just the last couple of days. So it really is the greatest fear that underlies this whole conflict. So we're speaking on Monday, May the 12th. Now, what are the economic implications for both countries if the ceasefire doesn't hold?
Pakistan remains mired in a real economic crisis and is in the midst of trying to obtain access to, I think, around $7 billion worth of loans from the International Monetary Fund. And it badly needs that money. Now, on the Indian side, this conflict really was not a priority. India was under the impression that it was largely not quite settled, but a conflict that was more or less under control.
wasn't really at risk of flaring up again. And so as a result, you had India really turning its attention elsewhere. Modi had really spent a lot of time in the last couple of years trying to bolster relationships with Europe, with the Middle East, of course, with the US. And are
And arguably, the most pressing item on Modi's international agenda was negotiating a trade deal with the US until this conflict broke out. And on the day that the conflict broke out, Modi was actually hosting Vice President JD Vance in India, where the two talked about a number of things, but talked about this trade deal that the two countries are trying to hammer out.
And it's been a real distraction, you could say, for both sides, which is probably a pretty good incentive for the two to also hold the ceasefire and try to put the conflict behind them, at least for now. You mentioned Vice President J.D. Vance was in India during the Kashmir attack. He visited India actually with his family and dined with Prime Minister Modi at his residence. And last week, he said that the conflict was fundamentally none of the U.S.'s business.
But that then did appear to change. So how should we see the U.S. in this relationship?
Do you see the US taking a backseat if this conflict develops further? Or do you see it taking a more interventionist role from here? It's hard to see how the US, how the Trump administration can take a backseat now after all of the sort of tweets and posts and proclamations online. I think the US has fully inserted itself into this conflict, whether it wants to be or not. And
That is potentially a problem for the US and for the Trump White House, which is really stretching itself as it tries to play peacemaker in all these different conflicts around the world. Trump, of course, pledged from day one to solve the Ukraine-Russia conflict. That's still ongoing. The conflict in Gaza is still ongoing. And now you've got
So I'm sticking his nose into this conflict as well. Now, it remains to be seen what shape exactly this purported US mediation is going to take. And as I said, a lot of people on the Indian side have really just rejected the idea of US intervention at all. So we'll just have to see exactly how this looks.
And what about China, who has been such a supporter of Pakistan? Where do you see its role potentially in this dynamic? China has been one of those countries that from the beginning has been calling for both sides to de-escalate.
It's also made very clear that it is on the side of Pakistan in this dispute. And that backing has really increased in the last couple of years in the form of foreign investment and weapons sales as well. And you saw the introduction of some of that on the battlefield in just the last couple of days. And, you know, that's a real complicating factor for India because India and China don't get along. India and Pakistan don't get along.
the US and China don't get along. And now you have the US and India increasingly getting along. So this is very quickly turning into a sort of however many way fight in this part of the world. So it does make the world look, at least on the margin, a little bit more risky and a little bit more dangerous. Dan, thank you so much for making time. Thanks for joining us. Thank you so much.
This is The Big Tech Asia from Bloomberg News. I'm Wan Ha. This episode was produced by Yang Yang and Naomi Ng. It was edited by Patty Hirsch and Daniel Tenkate and fact-checked by Bloomberg's editorial team. It was mixed and sound designed by Alex Sugiera. Our senior producer is Naomi Chavon. Our senior editor is Elizabeth Ponzo. Our deputy executive producer is Julia Weaver.
Our executive producer is Nicole Beamster-Bower. Sage Bauman is Bloomberg's head of podcasts. If you like this episode, make sure to subscribe and review The Big Tech Asia wherever you listen to podcasts. It really helps people find the show. Thanks for listening. See you next time.
Hiscox Small Business Insurance knows there is no business like your business. Across America, over 600,000 small businesses, from accountants and architects to photographers and yoga instructors, look to Hiscox Insurance for protection. Find flexible coverage that adapts to the needs of your small business with a fast, easy online quote at Hiscox.com. That's H-I-S-C-O-X dot com.
There's no business like small business. Hiscox Small Business Insurance. In Orlando, meetings reach another level thanks to a growing list of award-winning restaurants, a world-class convention center, a great hotel community, easy access through the airport, and of course, the weather. Andrew Moyes, VP of Fan Expo HQ, had this to say about Orlando.
Often we will bring our entire team to Orlando for the event, and that includes our executive-level team members as well. And we're able to give them a great experience with luxury hotels, special restaurants, all those key things to feed into the proper executive experience. Orlando's easy airport access and close proximity to hotels and transportation make it a top choice for hosting major events.
And while you may know Orlando for its attractions, industries like healthcare, aerospace, and advanced manufacturing make it a hub for cutting-edge businesses. Or in the words of Mr. Moyes, Orlando really can be that destination where you can innovate, collaborate, and look to the future. And that's what makes Orlando unbelievably real. Learn more at OrlandoForBusiness.com. You're listening to an iHeart Podcast. ♪