India captured a second Pakistani soldier in Kashmir. Another was captured earlier in the month. Pakistani army chief General Pervez Musharaff admitted in a BBC interview that his government, including prime minister Sharif, were aware of operations of Islamic militants inside of Indian Kashmir and approved of it. Musharaff stated that incursions by Indian and Pakistani patrols into each others territory had been going on for over ten years. He insisted that parties unnamed had instigated a disinformation campaign to create a rift between the Pakistani army and government over the issue. The Pakistani army got involved supporting the militants to prevent a possible Indian invasion of Pakistani Kashmir. Musharaff denied that any Pakistani troops were operating on the Indian side of the line of control.
July 15: One curious side effect of the Kashmir fighting was it's influence on some tribal rebels in the Indian province of Assam. The Bodo Liberation Tigers, one of three rebel groups among the Bodo people, announced they would cease hostilities and ask for talks with the government. This was done because of the danger of foreign nations taking advantage of Indias peril in this national crises (or something along those lines.) In ten years of rebellion in Assam some 10,000 soldiers, civilians (mostly civilians) and rebels have been killed.
July 13; Militant groups in Pakistan are outraged by the withdrawal of Pakistani troops from Indian Kashmir. Pakistani prime minister Sharif insists that was either withsraw or risk wider war with India. Pakistani artillery renewed shelling the Indian highway snaking through the Kashmir mountains. Indian officers said this was expected, the use of artillery to cover the retreat of Pakistani troops. Both countries now have nuclear weapons. India estimates that it's war in Kashmir cost about a quarter of a billion dollars (some four million dollars a day.) Indian finance officials fear that this might have an adverse effect on the economy. Pro-Army politicians are urging that defense spending increase from 2.3 percent of GDP to three percent. This will encourage Pakistan to raise their spending as well, possibly setting off an arms race that neither nation can afford.
July 12; Fighting stopped in Kashmir. The militants appeared to be withdrawing. India denied that there was a cease fire and Pakistani again denied that any of its troops were in Indian territory. However, Pakistani prime minister Sharif praised the militants for agreeing to withdraw from Indian territory by July 16th. In two months of fighting, 333 Indians and, by Indian estimate, 679 Pakistani troops were killed. The estimate of Pakistani losses is probably too high, although the Indians had a fire power advantage and the militants rarely retreated (often they could not because of the geography) from their positions. But the Pakistanis had excellent defensive situations, where they could see Indian troops coming up after them.