DESPITE multiple official and track-2 efforts, the Mumbai rupture has not healed and India-Pakistan bilateral dialogue remains stalled, with both sides approaching normalisation from different perspectives.

India maintains that Pakistan will have to show visible progress in tackling anti-India militants before it can expect New Delhi to return to the table for a meaningful dialogue. The Indian position is pegged on the argument that a dialogue without this precondition is not only politically untenable for New Delhi but also creates a perverse incentive for Islamabad not to address the issue of terrorism emanating from Pakistani soil. The general sense in New Delhi, and in many other world capitals, is that Islamabad wants to do nothing.

Sound though it seems on the surface, this position is problematic in that declaring progress on terrorism as a prerequisite for a holistic bilateral dialogue provides no solution. It makes India-Pakistan progress hostage to any group bent on creating chaos and in fact is incentive for further terrorist attacks. Moreover, it ends up undermining the one goal shared by both India and Pakistan and their international allies, i.e. absence of conflict in South Asia.

Consider the present calculus.

All regional and extra-regional parties agree that South Asian peace is dependent on India-Pakistan normalisation. But rapprochement cannot occur unless a political dialogue on all major issues is sustained. Given the environment in which non-state actors are operating and can strike at will, the only guarantee for a sustained dialogue that can reduce the incentive for disruption by spoilers is a robust India-Pakistan negotiating mechanism. The more insulated the process is from external shocks, the tougher it becomes for non-state actors to disrupt it. On the contrary, if either side declares that a particular kind of incident will cause it to pull away from dialogue, the task of the vested interests has already been defined.

Let us examine the present situation from the perspective of the militant enclave.

In terms of the anti-India groups, while there is no clarity on the role of the Pakistani state in supporting outfits like Lashkar-i-Taiba, it has become fairly obvious that the Pakistani state no longer commands full authority over the enclave. There is increasing evidence that groups like Lashkar-i-Taiba and Jaish-i-Mohammad (or others) can operate without the ISI`s blessings if they wish.

This being a given, what would I as, say, the Lashkar, do to disrupt official ties. A repeat of a Mumbai-like episode, even on a much smaller scale, would be the most obvious option. Interestingly, my compulsion to launch such an attack would become greater if I feel the Pakistani state is taking steps that prove its commitment to fulfilling the Indian prerequisite (i.e. when I am being targeted).

The perverse incentive is not limited to groups traditionally involved in militancy in India. Consider groups like Al Qaeda and the Tehrik-i-Taliban Pakistan under a situation where the Pakistan-US combine is denting their presence in the Pakistan-Afghanistan border regions, not an altogether unrealistic scenario in the months to come. How best could they distract Pakistan`s offensive and ease the onslaught? The answer once again lies in providing reason for Islamabad to refocus on its traditional threat. These groups could engineer an attack in India and allow the fingers to be pointed at any anti-India group, thus raising India-Pakistan tensions.

Let us also not fool ourselves about what the next terrorist attack in India would mean in terms of conflict in South Asia.

The sentiment in India towards terrorism emanating from Pakistan would make it virtually impossible for any Indian government to calm emotions. India will likely proceed with a retributive strike which, while not delivering any lasting results, would be enough to satisfy domestic constituencies. The Pakistani apparatus is virtually guaranteed to respond in kind.

Beyond this first exchange lies uncharted territory. Most seem to suggest that international diplomacy will kick in and prevent crisis escalation. Indeed, that will be the best-case scenario. But it is important to flag just how easily things could go wrong.

The region will be dealing with an unprecedented nuclear crisis in an environment where very little is understood about each other`s nuclear responses. There is no transparency to speak of; in fact, opacity and ambiguity in postures is seen as stability-inducing and both sides have made a deliberate effort to not develop a common understanding on how they will react to particular crises situations. The possibility of underestimating the risks the other side may be willing to take is very real and can bring the region perilously close to an actual nuclear exchange. There are even no protocols to deal with nuclear accidents, miscommunication or false alarms.

Let me acknowledge that the view presented here puts India in a greater predicament than Pakistan. The policy implication of the above is that political dialogue must continue at all costs and should be insulated from terrorist attacks. But that is exactly what India feels it cannot afford if it is to successfully bring international pressure to bear on Pakistan to `do more`. Indeed, the truth is that the overall equation is stacked in Pakistan`s favour. By pledging incapacity to tackle militancy in a sustainable manner in the short run and simultaneously highlighting the increased potential for conflict if bilateral political dialogue is not insulated from terrorism, Islamabad can continue pointing to the self-fulfilling prophecy the Indian position creates. And while this stance will likely be counter-productive to Pakistan`s own interests in the long run, it does leave India, and indeed the international community, in a catch-22 situation.

In the final outcome, the positions on both sides put more than a billion South Asians at extreme risk. As the situation stands, the two fundamental issues needed to bring about peace between India and Pakistan — settling outstanding concerns through dialogue and tackling the spreading menace of terrorism in a coordinated manner — are being ignored.

The writer is South Asia adviser at the US Institute of Peace, Washington, D.C.