Disputes - international:
Kashmir remains the world's most highly militarized territorial dispute with portions under the de facto administration of China (Aksai Chin), India (Jammu and Kashmir), and Pakistan (Azad Kashmir and Northern Areas), but recent discussions and confidence-building measures among parties are beginning to defuse tensions; India does not recognize Pakistan's ceding lands to China in the 1965 boundary agreement; disputes with Pakistan over Indus River water sharing and the terminus of the Sir Creek Estuary at the mouth of the Rann of Kutch, which prevents maritime boundary delimitation; Pakistani maps continue to show Junagadh claim in Indian Gujarat State; most of the rugged, militarized boundary with China is in dispute, but sides have committed to begin resolution with discussions on the least disputed Middle Sector; Joint Border Committee with Nepal continues to work on resolution of minor disputed boundary sections; discussions with Bangladesh remain stalled to delimit a small section of river boundary, to exchange 162 miniscule enclaves in both countries, to allocate divided villages, and to stop illegal cross-border trade, migration, and violence; Bangladesh protests India's attempts to fence off high-traffic sections of the porous boundary; dispute with Bangladesh over volcanic New Moore/South Talpatty/Purbasha Island in the Bay of Bengal deters maritime boundary delimitation; India seeks cooperation from Bhutan and Burma to keep out Indian Nagaland insurgents; joint border commission continues to work on small disputed sections of boundary with Nepal; India has instituted a stricter border regime to restrict transit of Maoist insurgents and illegal cross-border activities from Nepal
Illicit drugs:
world's largest producer of licit opium for the pharmaceutical trade, but an undetermined quantity of opium is diverted to illicit international drug markets; transit point for illicit narcotics produced in neighboring countries; illicit producer of methaqualone; vulnerable to narcotics money laundering through the hawala system
