India-Pakistan Escalation: A Game Theory Analysis

As someone who has worked in senior national security policy roles I've never seen a bigger crisis brewing between India and Pakistan. Here is my Game-theory based analysis on the situation as it builds up and decision matrix for key parties in this conflict: India, Pakistan, and the US.

But upfront, it appears that all sides have run out of options with each other and are at a breakpoint which makes this specific crises unique and very dangerous.

1. India - is fuming and wants to retaliate in a spectacular way. Unlike last time when it blamed Jihadist networks in Pakistan, this time the Indian networks are directly aiming at Chief of Army Staff, Gen Asim Munir. This is primarily because of COAS recent irresponsible speech that created a diplomatic mess and opened space for a spark to lit up the fragile India-Pak relations. India's strategic goal is to demonstrate strength, deter future attacks, hold Pakistan accountable and most likely inflict punishment by forcing the Pakistan Army out of power in the country.

2. Pakistan - has no good options and is terribly cornered due to the COAS speech that links him directly to the attacks in Kashmir. It can neither own or disown the attacks, the best it can do is to call it a 'false flag' which might not fly globally. With a military regime in power that lacks credibility & legitimacy, weak economy, and political instability, Pakistan's regime has no option but to find ways to deescalate through the US mediation, preserve regime stability, avoid sanctions and isolation. But India want's a head, and there will no deescalation without something tangible that Pakistan can offer in return. Will the regime in Pakistan climb the escalation ladder? Damned, if they do; damned, if they don't.

3. US - is going to be embarrassed and will be under tremendous pressure from India that has been complaining them about writing Pakistan Army a blank cheque for too long. With JD Vance trying to woo Indians while this attack happened, the Trump admin might come out hard against Pakistan. How hard, depends on how much India is going to press but from what it appears, the Trump admin might just call off all bets on Pakistan's current military led regime which was warming up to the US through minerals deal and CT cooperation. The US strategic goal is to maintain relations with India, allay its fears that the US support for Pakistan will not damage India, and ensure that a regional war between two nuclear powers doesn't blow up the entire world.

So what can possibly happen from here: Game Tree

India's Opening Move:

Option A: Strategic Strikes (Balakot-style)

Option B: Diplomatic warfare and isolation of Pakistan

Option C: Full-force military build-up

Pakistan’s Counter:

Option A: Blame foreign hand (false flag narrative)

Option B: Offer high-profile scapegoat (e.g., remove rogue ISI official or reshuffle military leadership)

Option C: Mobilize troops as deterrent

US Role:

Option A: Publicly condemn Pakistan, cut military aid

Option B: Quiet diplomacy, mediate channel between India and Pakistan

Option C: Let India strike but ensure no escalation (a la 2019)

3 Possible Scenarios:

Scenario 1: Limited Indian Covert Strike + Pakistani Concession Mediated by the US (Most likely)

Scenario 2: Full Scale War (Unlikely since Pakistan can't risk it)

Scenario 3: India Goes for Diplomatic War (Unlikely given the public mood in India)

It's hard to predict as the situation is still evolving and facts are not fully clear; but going by the data and pattern from last 25 years, India has no option but to retaliate with some form of US mediation that will force Pakistan to make major concessions which could include a change in military leadership, some crackdown on local Kashmiri networks, and perhaps allowing India to take some surgical strikes.