There's no sign of either India or Pakistan backing down, even though the UN and U.S. are putting a lot of pressure on both sides. Troops remain massed at the border and India is talking about keeping the number of troops on the border area permanently higher. This is unlikely as it would be too expensive to build new bases. After a few months, the troops on the border will begin to suffer morale problems from the rough living conditions and lack of action. India is insisting on a Pakistani crackdown on rebels based in Pakistan but operating in Indian Kashmir. Pakistan is making moves in that direction, but not nearly fast enough for India. The Kashmir violence in the past week is the result of strikes and demonstrations by peaceful separatist organizations as well as attacks from the two Pakistani militant separatist rebel outfits. The rebels are increasingly killing civilians to either drive out non-Moslems or to terrorize Moslems into supporting the rebels.
With so much of the Pakistani army concentrating on a potential war with India, operations on the Afghan border against fleeing al Qaeda and Taliban fighters has eased up. Pakistan is still allowing U.S. officials (from the FBI and military) to interrogate al Qaeda prisoners captured in Pakistan. American special forces are also still operating on the Pakistan side of the border, with the Pakistani government ignoring this activity (especially as long as the special forces do not create a fuss with any of the tribes.)