FirstFT: India downgrades relations with Pakistan

Good morning and welcome again to FirstFT Asia. In right now’s publication:

• India downgrades ties with Pakistan

• The US Treasury secretary’s remarks on China commerce battle de-escalation

• Chinese language web customers mock Trump’s tariffs

India has downgraded diplomatic relations with Pakistan and suspended its participation in an important cross-border water treaty, accusing Islamabad of being concerned in a lethal assault on vacationers within the disputed northern area of Kashmir.

Prime Minister Narendra Modi convened senior ministers yesterday to resolve how to answer Tuesday’s killing by suspected militants of 26 vacationers within the India-controlled territory of Jammu and Kashmir. Right here’s what to know concerning the simmering tensions between India and Pakistan.

India’s response: On the assembly, the “cross-border linkages of the terrorist attack were brought out”, India’s overseas secretary Vikram Misri instructed a information briefing with out giving particulars of Pakistan’s alleged function. Misri mentioned the Indus Waters Treaty of 1960, which governs the use by the 2 international locations of water assets within the Indus river system, could be held in “abeyance . . . until Pakistan credibly and irrevocably abjures support for cross-border terrorism”. The overseas minister additionally introduced new journey restrictions.

Fears of a confrontation: Indian defence minister Rajnath Singh vowed to ship a “very loud response” to these behind the assault. New Delhi has lengthy accused Islamabad of supporting terrorism in Jammu and Kashmir and has beforehand staged navy strikes on its nuclear-armed neighbour in response to militant assaults within the territory.

Pakistan’s overseas ministry didn’t instantly touch upon India’s allegations of involvement, saying in a press release yesterday that it was “concerned at the loss of tourists’ lives in an attack in Anantnag district of Indian Illegally Occupied Jammu and Kashmir”.

Setback for Modi: The prime minister’s authorities has claimed to have introduced peace to Jammu and Kashmir since 2019 when it decreased what was India’s solely Muslim-majority state to a territory below direct federal rule. The assault was the deadliest within the area since a 2019 suicide bombing when 40 Indian paramilitaries had been killed — prompting India to launch an air strike inside Pakistan on what it mentioned was a terrorist coaching camp. 

Right here’s what else we’re protecting tabs on right now:

• Financial information: Japan reviews March providers PPI inflation figures and South Korea publishes advance first-quarter GDP.

• Corporations: Alphabet, SK Hynix, Tech Mahindra, Fujitsu and Hyundai Motor report earnings.

5 extra high tales

1. US Treasury secretary Scott Bessent has cautioned that any de-escalation within the US-China commerce battle must be mutual, denying reviews that President Donald Trump would unilaterally minimize levies on Chinese language items. Bessent additionally instructed reporters: “A break between the two countries on trade does not suit anybody’s interests.”

• Extra commerce battle information: Trump is planning to spare carmakers from a few of his most onerous tariffs, following intense lobbying by business executives.

• China-EU relations: Beijing is getting ready to carry sanctions on European lawmakers because it tries to revive an funding take care of the EU after shedding most of its entry to the US market in Trump’s commerce battle.

• Boeing confronts commerce battle fallout: The US plane maker is ready to search for different consumers for its planes destined for Chinese language airways, its chief govt has mentioned.

2. Trump has attacked Ukrainian chief Volodymyr Zelenskyy for refusing to recognise Russia’s occupation of Crimea, accusing him of harming peace negotiations with Moscow. His intervention got here days after the US floated concepts for a attainable decision of the battle that included Washington recognising Russian management over Crimea, the Black Sea peninsula that Russia annexed in 2014.

3. World Financial Discussion board founder Klaus Schwab allegedly manipulated the organisation’s analysis to curry favour with governments, in accordance with whistleblower claims that led to his resignation as chair of the organisation over the Easter weekend. In a press release circulated yesterday, Schwab mentioned he was the sufferer of a “character assassination” and denied all of the claims in opposition to him.

4. The British banker tasked with overhauling Nomura’s international funding operations after a $2.9bn hit from the collapse of Archegos has mentioned his merchants are lastly nearer to with the ability to go “max risk”. Christopher Willcox instructed the FT he was more and more assured of taking daring, high-stakes bets in an interview on the financial institution’s Tokyo headquarters.

5. Jordan banned the Muslim Brotherhood yesterday, casting doubt on the way forward for the Islamist group’s political arm, which emerged because the nation’s largest opposition pressure in final yr’s election. The transfer comes per week after Jordanian authorities mentioned that they had arrested 16 members of the Brotherhood, whom they alleged had been skilled in Lebanon to hold out rocket and drone assaults inside the kingdom. Learn the complete story.

Information in-depth

Web customers in China mocked Trump’s declare that “jobs will come roaring back” to the US because of his tariffs with synthetic intelligence-generated movies depicting American employees sweating over coach and smartphone meeting strains. The movies highlighted that there’s little likelihood of the US replicating the labour pressure benefits that turned China into the world’s manufacturing unit over greater than 20 years.

We’re additionally studying . . . 

• Maga Catholics: A rising variety of People hope Pope Francis’s demise will mark a decisive conservative shift and pave the best way for a “Trump-like pope”.

• Banking on the seashore: Citigroup is closing its beachside Málaga workplace lower than three years after opening the hub to supply bankers a greater work-life steadiness.

• Tradwives: Home influencers have turn into pin-ups of the spiritual proper’s quest for larger start charges, writes Chine McDonald of think-tank Theos.

Chart of the day

Jane Road’s buying and selling revenues virtually doubled final yr and boomed through the tariff-induced turmoil of the primary quarter of 2025, because the secretive US agency generated income rivalling these of Goldman Sachs and Morgan Stanley.

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