Abstract India and Pakistan are at war with each other for over 70 years. To date, the two countrieshave four full scale wars. This thesis evaluates whether the dispute between Pakistan andIndia is linked with the economic development of the rival country or there are otherreasons for it such as terrorism, border disputes, etc. In the analysis, special attention ispaid to tensions related to Kashmir which started in 1948 and are still there. Kashmirplays a vital role in development of Pakistan in a broader context because The IndusRiver, which is the lifeline to Pakistan, flows through the Jammu and Kashmir. Casestudy method was employed, based on secondary data from the existing studies. Thisthesis is based on theories of international politics to explore the Indus Water Treaty andChina Pakistan Economic Corridor in relation to the economic development of Pakistan.The findings reveal that, contrary to the popular belief of the people of the two countriesthat India and Pakistan are fighting over Kashmir’s territory, much of the problems arerelated to economic issues. Indus Water Treaty and China Pakistan Economic Corridorare helping Pakistan in coming out of the vicious circle of poverty and moving towardsdevelopment. Economic development in Pakistan is not beneficial for India, as Pakistanand India compete in their export markets. So, India is creating hurdles in the economicdevelopment of Pakistan. The violation of Indus Water Treaty by India and India’sinterferences in China Pakistan Economic Corridor are two such examples of it. TheChina Pakistan Economic Corridor will increase foreign investment in Pakistan whichwill lead to economic development of Pakistan. This may strengthen Pakistan’s exportsector and challenge India in its international export markets. Therefore, India is creatinghurdles for Pakistan. Moreover, efficient utilization of water may lead to an increase inpower generation in Pakistan which would help it in overcoming energy shortageproblem, especially electricity. If this problem will be resolved, industry and exportsector will be developed, and Pakistan may compete India in export markets. It wasconcluded that major reason of conflicts between India and Pakistan are economic, notpolitical, geographical, or military.