Tensions between India and Pakistan remain elevated more than a year after the May 2025 four-day conflict known as Operation Sindoor, during which Indian forces struck terror-linked targets inside Pakistan and both sides exchanged drone, missile, and airstrikes before a U.S.-brokered ceasefire. Diplomacy stays frozen, with bilateral channels largely closed. Recent escalation centers on the suspended Indus Waters Treaty, where a Hague tribunal ruling has intensified accusations of water weaponization and prompted Indian statements committing to reduced flows. Both countries continue military modernization along the Line of Control, including drone swarms, electronic warfare systems, and precision munitions, while cross-border militant activity and mutual allegations of sponsorship persist. These factors sustain trader focus on the risk of renewed Indian strikes in response to any significant trigger.