This article investigates the underlying causes for the persistency of the India–Pakistan conflict and, on this basis, the chances and obstacles of the bilateral composite dialogue initiated in 2004. In particular, it wants to provide a theoretically grounded account of the factors that facilitated and constrained the bilateral composite dialogue process. Drawing on the regional security complex theory, this article examines the rivalry between the two South Asian nuclear powers on four levels of analysis: the domestic, the regional, the interregional and the global level. The analysis shows that there have been some substantial changes on all four levels in the recent decade or so and that these changes have provided more beneficial conditions for a peace process. These changes include, inter alia, India’s new regional policy, the consequences of the 9/11 terrorist attacks for the region and India’s growing power capacities. However, major obstacles to the India–Pakistan dialogue and a permanent conflict resolution continue to persist: the dominant role of the military in Pakistan, conflicting national identities and the still partially contested nature of statehood in India and Pakistan, which is in the case of Pakistan linked to the growing power of Islamic fundamentalists.
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