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A damaged portion of Bilal Mosque is seen after it was hit by an Indian strike in Muzaffarabad, the capital of Pakistan-administered Kashmir, on May 7, 2025.
India launches strikes on Pakistan
It was never going to end quietly: India early on Wednesday bombed what it said were nine militant sites within Pakistan and Pakistani-administered Kashmir, reportedly killing at least 26 people in the worst clash between the two countries in decades.
Warning signs. India launched the strikes in retaliation for a terrorist rampage in the Indian-controlled portion of Kashmir last month. Pakistan says it had nothing to do with that attack.
Pakistani response now inbound. Pakistan Prime Minister Shehbaz Sharif called the Indian airstrikes an “act of war,” and has reportedly authorized the military to respond in kind.
Reaction from abroad. Major countries including the US, Japan, France, and China – which has close ties to Pakistan but borders both countries – called for restraint. Israel notably issued its unequivocal support for India and its right to self defense.
What will happen next? “Pakistan has traditionally responded with a tit for tat response, normally a bombing run on a minor target on Indian soil,” said Pramit Pal Chaudhuri, Eurasia Group’s South Asia practice head. However, Chaudhuri doesn’t expect the fighting to last long.
“Both sides are nuclear armed, neither has overwhelming military dominance and both lack the economic or political interest in a sustained conflict,” said Chaudhuri. “These skirmishes tend to die out within 24 to 48 hours.”
UK Secretary of State for Business and Trade Jonathan Reynolds meets Indian Minister of Commerce and Industry Piyush Goyal for trade talks, in London, United Kingdom, on April 28, 2025.
UK, India finally cinch trade deal
The United Kingdom on Tuesday sealed its largest trade deal since leaving the European Union, inking a pact with India in a big political win for Prime Minister Keir Starmer.
The highlights: drink and drive. India’s tariffs on UK whisky and gin will halve from 150% to 75%, before falling to 40% over the next decade. Levies on UK auto products will also plummet from 100% to 10%, albeit with some quotas in place. The UK, in turn, will slash tariffs on Indian clothing, foodstuffs, and jewels.
UK-India trade surpassed $50 billion last year, and the deal is projected to add $35 billion a year by 2040.
Starmer succeeds where Sunak failed. Former PM Rishi Sunak had tried desperately to clinch a deal with India during his 20-month premiership.
The migration angle. The pact exempts Indians on short-term UK visas from paying social security taxes for three years – the UK right is already mad about that.
Mujtaba Rahman, Eurasia Group’s managing director of Europe, said the deal is “welcome news” for the UK government.
“However, the real test for Keir Starmer will be how far he can dismantle the trade friction with the UK’s biggest trading partner – the EU,” Rahman added. “That will require a bolder approach than we have seen so far.”
Indian paramilitary soldiers patrol along a road in Srinagar, Jammu and Kashmir, on April 29, 2025.
India and Pakistan inch toward a major clash
Nerves are fraught throughout Pakistan after authorities said Wednesday they have “credible intelligence” that India plans to launch military strikes on its soil by Friday, fueling fears of an outright clash between the two nuclear-armed archrivals. Troops from both sides have been exchanging fire in the disputed territory of Kashmir since a terrorist attack in the Indian-controlled section killed 26 civilians last Tuesday. Both China and the US are calling for restraint.
Tensions are spiraling rapidly. India closed its airspace to Pakistan on Wednesday and ordered nearly all Pakistani citizens to leave the country last week. Pakistan – while denying any involvement in the attacks – also canceled visas last week for most Indian citizens in retaliation. The scenes of rapid flight evoked painful memories of the 1947 Partition when Hindus in Pakistan and Muslims in India fled bloody ethnic massacres in the newly formed nations.
How bad could it get? The two countries have had two major wars, in 1965 and 1971, both of which India won, in the latter case quite decisively. In the ensuing decades, however, India has utterly outstripped Pakistan economically, militarily, and diplomatically, which means that Islamabad’s chances of prevailing in a conventional confrontation are very slim.
The balance of power shifted nonetheless when Pakistan began developing nuclear weapons in 1972 to match the India program begun in 1967. This has prevented a full-scale attack ever since. When the two sides went to war in 1999, hostilities lasted just over two months and were geographically limited to the Himalayas. If New Delhi should be foolish enough to existentially threaten its neighbor, it raises the grim – albeit unlikely – prospect of a nuclear exchange.
We’re watching for a limited engagement, but we’re far from sanguine about the risks.
U.S. President Donald Trump and Indian Prime Minister Narendra Modi shake hands as they attend a joint press conference at the White House in Washington, D.C., U.S., February 13, 2025.
A winner from Trump tariff wars? Maybe India
Modi has been around long enough to have navigated trade frictions during Trump’s first term, and he was one of the first world leaders to approach Trump earlier this year with a conciliatory approach to growing trade tensions. Now, according to US Treasury Secretary Scott Bessent, the first phase of a new US-India trade deal might be “one of the first trade deals we would sign." Following a visit to Washington last week, Rajesh Agrawal, India’s lead trade negotiator, highlighted hopes for a “mutually beneficial, multi-sector bilateral trade agreement by fall of 2025, including through opportunities for early mutual wins.” Creating more market openings for US exports will come at a cost in a country long known for trade protectionism, but Modi has also made moves in recent years to open trade talks with the EU, the UK, and others.
This also follows news that, to avoid the Trump administration’s surging tariff rates on China, Apple has unveiled plans to move production of most of the 60 million iPhones it sells in the US each year from China to India by the end of 2026 – though the transition may take longer.The letters "DDPF" are seen tagged on a wall of the Aix-Luynes Penitentiary Center in Aix-en-Provence, France, on April 15, 2025.
HARD NUMBERS: Terror hits French prisons, UK court defines "woman", Donald dulls diamonds, Wall Street mints money from chaos, India charges Gandhis with money laundering, Protests erupt in Tunisia
6: At least six French prisons have faced attacks from gunmen and arsonists this week in what authorities say were acts of terrorism. No one has claimed responsibility for the incidents, although several featured graffiti of the letters “DDPF,” an acronym for “French Prisoners’ Rights.” The attacks come as the government tries to stamp out rising drug violence – cocaine imports to Europe are blowing through records.
5: In a ruling sure to echo into culture wars about gender around the world, five judges of the UK Supreme Court on Wednesday ruled unanimously that, under the country’s anti-discrimination laws, the term “woman” refers only to a person born biologically female. The ruling was seen as a blow for trans rights activists, though the court stressed that it did not remove protections under other laws for trans people. The case stemmed from a dispute in Scotland over a law that required 50% female representation on the boards of public companies.
1/7: US President Donald Trump is a well known lover of all things gold, but his policies are now dulling the luster of another luxury jewel: diamonds. Shipments of the precious stones through Antwerp, a major hub, have fallen to just one seventh of normal levels since Trump began slapping tariffs on most of the world. The highly-globalized diamond industry includes mines in Africa, Asia, and Canada, polishing centers in India, traders in Europe and the Middle East, and – crucially – certifiers in the US. Tariff uncertainty has thrown a wrench into all of that, right as the industry is already suffering from competition with lab-grown gemstones.
37 billion: Some potential buyers of diamonds now have some extra cash to burn, as Wall Street’s biggest banks clocked $37bn in trading revenues in the first quarter of this year. Why? The wild, Trump-induced gyrations of the stock market created huge volatility, handing smart traders an opportunity to find an angle – including US Rep. Marjorie Taylor Greene (R-GA), who has drawn fire over the timing of her own recent stock jockeying.
300 million: Authorities in India have charged the opposition Congress party leader Rahul Gandhi and his mother Sonia with money laundering, alleging that they used a shell company to illegally take control of properties worth more than $300 million. The Congress party said the probe, which began in 2022, is a “vendetta” by Prime Minister Narendra Modi’s ruling Bharatiya Janata Party.
3: Protests erupted in Tunisia on Tuesday after the collapse of a school wall in the town of Mazzouna killed three students on Monday. Several hundred protesters gathered both in Mazzouna and in the capital, Tunis, accusing the government of negligence and incompetence. This is no small thing in a country that tightly polices dissent. Keep an eye on how the government responds – this is, after all, a place where a single exasperated street vendor once sparked a region-wide revolution.
The Canadian flag flies on Parliament Hill in Ottawa.
Who’s meddling in Canada’s election?
Canada’s foreign interference watchdog is warning that China, India, and Russia plan on meddling in the country’s federal election. The contest, which launched last weekend, has already been marked by a handful of stories about past covert foreign interventions and threats of new ones.
This week, the Globe and Mailreported allegations that India interfered in 2022 to help get Conservative Party leader Pierre Poilievre elected, though he was not aware of the efforts. They also broke news that former Liberal Party leadership candidate and member of Parliament Chandra Arya was banned from running for leader and reelection because of alleged interference tied, once again, to India.
Now, Canada’s election interference monitoring group is warning that China, India, and Russia will try to interfere in the current election.
Poilievre also accused Liberal leader Mark Carney of being cozy with Beijing due to a $276 million loan Brookfield Asset Management secured from the Bank of China when Carney was Chair of Brookfield’s board. Carney rejected those accusations and, on Wednesday, said that Canada should not pursue greater economic ties with China but should prioritize other Asian nations and Europe.
Other Canadian critics have complained that the US is interfering, citing Donald Trump consigliere Elon Musk’s public statements about the country. But officials say this doesn’t meet the bar for foreign interference. Neither, apparently, do the actions of Alberta Premier Danielle Smith,who recently admitted to Breitbartthat she pressed Trump administration officials to delay tariffs to help elect the Conservatives over the Liberals, since Poilievre would be “the best person” for the White House to deal with given that he would be “very much in sync with the new direction in America.”Congolese civilians who fled from Bukavu, eastern Democratic Republic of Congo, following clashes between M23 rebels and the Armed Forces of the Democratic Republic of the Congo, carry their belongings as they gather at the Rusizi border crossing point to return home, in Rusizi district, Rwanda, on Feb. 17, 2025.
Hard Numbers: Rebels advance in DRC, Yuge trade corridor, Tragic flooding strikes US, UN seeks billions for Sudan, Taliban visits Japan, Plane crashes in Toronto
350,000: M23 rebels are meeting little resistance in their advance on Bukavu in the eastern Democratic Republic of Congo, further challenging Kinshasa’s rule. This move comes after the Rwandan-backed rebels seized control of Goma late last month and just two days after the UN warned that unrest in the country has displaced 350,000 people.
600: Israel and India are working on a free trade agreement they hope to announce as early as 2025. Israeli and Indian business leaders held over 600 meetings in New Delhi last week, on cybersecurity, smart agriculture, renewable energy, digital health, and water technologies, AI, and big data. Meanwhile, US President Donald Trump continues to push for the rail and shipping corridor advocated by his predecessor, Joe Biden, to connect India to the Middle East, Europe, and the US, which he and Indian Prime Minister Narendra Modi call “one of the greatest trade routes in all of history.”
10: Severe flooding claimed the lives of at least 10 people in the United States over the weekend, including nine in Kentucky and one in Georgia. Storms walloped Kentucky, Georgia, Alabama, Mississippi, Tennessee, Virginia, West Virginia, and North Carolina, with Kentucky Gov. Andy Beshear saying that nearly 1,000 people had to be rescued.
6 billion: The United Nations announced on Monday that it wants to raise $6 billion for Sudan to help alleviate one of the world’s worst hunger crises caused by nearly two years of civil war between the Sudanese army and the paramilitary Rapid Support Forces. The need, the agency says, has increased 40% from last year’s appeal.
1: While Afghanistan’s Taliban government makes regular visits to countries close to home, such as Russia, China, and parts of Central Asia, this weekend it went further afield. The Taliban sent its first-ever delegation to Japan on Sunday to seek humanitarian support and to discuss establishing diplomatic ties with Japanese leaders. One Afghan leader said that the Taliban seeks “dignified interaction with the world for a strong, united, advanced, prosperous, developed Afghanistan.” Japan’s foreign ministry has not commented yet on the visit.
18: A Delta Airlines flight from Minneapolis crash-landed at Toronto's Pearson airport on Monday, injuring at least 18 people, three critically. The plane crashed and flipped upon landing at the airport, which is located just outside Toronto. All 80 passengers and crew are accounted for, and crews are on hand to investigate what happened.
President Donald Trump and Indian Prime Minister Narendra Modi shake hands as they attend a joint press conference at the White House in Washington, DC, on Feb. 13, 2025.
Trump imposes tariffs, Modi brings gifts
As promised, US President Donald Trump announced reciprocal tariffs on all American trading partners Thursday afternoon. Each country will be assessed individually, factoring in value-added taxes, foreign tariff rates, industry subsidies, regulations, and currency undervaluation to determine customized duty rates. Trump claimed, “It’s gonna make our country a fortune.”
The tariff review will be completed within weeks or months and could kick-start bilateral negotiations with other countries. Trump took the occasion to reiterate that Canada should become a 51st state, chastising it for not meeting NATO spending thresholds and repeating his false claim that the US “subsidizes” Canada to the tune of $200 billion a year.
Then there’s India. Trump’s proclamation came ahead of his meeting with “total killer” Indian Prime Minister Narendra Modi at the White House. Modi reportedly arrived bearing a “gift”: tariff reductions on India’s imports of US electronics, medical equipment, and chemicals, as well as commitments to purchase American liquefied natural gas and defense equipment.
What else does Trump want from Delhi? Trump wants to reduce the US trade deficit with India, $45.6 billion in 2024. The average US tariff rate on Indian imports is currently 2.2%, while India’s is 12% on US goods. Trump also wants India to reduce the emigration of its citizens to the US – both H-1B visa-holders working in the tech industry and undocumented migrants. India is the third largest source of undocumented immigrants in the US.
On Thursday, Trump said he would match India’s tariffs. “We are being reciprocal with India … Whatever India charges, we charge them.”
Both men agreed on Thursday to begin talks on an early trade deal to resolve the tariff standoff. Modi said he would buy more US oil, gas, and military equipment while fighting illegal immigration, and Trump said the US would ultimately sell F-35 stealth fighters to India.