Tensions between India and Pakistan have hit boiling point after a brutal attack in Kashmir killed 26 Hindu tourists. Now, India is turning up the diplomatic heat - this time on the global stage.

India has formally asked the International Monetary Fund (IMF) to review all financial aid given to Pakistan, citing grave concerns after New Delhi identified two of the attackers as Pakistani nationals. Islamabad, however, flatly denies any involvement and is demanding a neutral investigation.

In a dramatic turn, India has suspended the Indus Waters Treaty, a decades-old river water-sharing agreement, and both nations have shut down airspace access to each other's airlines, sparking fears of further escalation.

The timing couldn't be worse for Pakistan. The country is relying heavily on a $7 billion IMF bailout and a fresh $1.3 billion climate loan granted just weeks ago. Despite the tension, Pakistan's financial advisor claims the IMF programme is “well on track,” boasting strong international interest during recent meetings in Washington.

Meanwhile, global powers are watching closely. The U.S. has called for calm but backed India's right to act in self-defense. With both nuclear nations on edge, the world is urging restraint - but the situation remains volatile.