In New Delhi last week the Foreign Secretaries of India and Pakistan met for the first time since the terrorist attack on Mumbai in November 2008; the official talks concluded with both sides arguing over what they should talk about. India demanded that Islamabad prosecute the Pakistani militants responsible for the Mumbai attacks more vigorously. Pakistan insisted that the core issue between the two countries remains the India-held Muslim majority valley of Kashmir, where, out of a population of some 7.6 million people, more than 80,000 people have died since an insurgency supported by Pakistan began in 1989.

In one sense at least, the faltering dialogue between India and Pakistan resembles the ‘peace process’ in the Middle East: by the time any ways to proceed are agreed upon, usually with much acrimony, peace seems even further away. Last week’s talks in Delhi most likely came about because of pressure from the United States. The Obama administration seems to have decided that it cannot do without Pakistani assistance in fighting the Taliban and al-Qaeda, and that Pakistan has its own strategic interests in Afghanistan. Pakistan has rewarded this overdue acknowledgment of its concerns by arresting senior Taliban leaders who have long been living in its territory. In return, the Obama administration has pressed India to be more conciliatory over Kashmir.

Of course, protecting American security interests isn’t the only reason why India and Pakistan should work toward a solution in Kashmir. As Basharat Peer’s new book, Curfewed Night, recounts, India’s occupation of the valley, enforced by more than half a million soldiers, has given a powerful raison d’etre to militant organizations in Pakistan, which have grown exponentially since 1989. Peer, a Kashmiri journalist and currently a Fellow at the Open Society Institute, was in his teens when the insurgency began in Srinagar, the capital of India-held Kashmir. His own friends, enraged by police firing upon unarmed demonstrators, left the valley to train in militant camps set up across the border by Pakistani intelligence and army officers. Sent away to India by his parents, Peer witnessed the progressive alienation and isolation of Muslims as Hindu nationalists unleashed one violent campaign after another through the 1990s. He later returned to Kashmir as a journalist, and Curfewed Night reflects his diverse experience of the valley by combining memoir with reportage, history, and analysis.

In clear, swift prose, Peer evokes the relentless ordeal of checkpoints, arbitrary arrests and disappearances that Kashmiri Muslims live with. He explores the valley’s syncretic Islam, and the attempts to undermine it by fundamentalists from Pakistan. He describes the plight of the poorest among more than a hundred thousand Kashmiri Hindus, who fled the valley after radical Islamists killed many of them. He also investigates the widespread use of torture against Kashmiri young men by Indian security forces, particularly the practice of inserting live copper wires into penises, which led to hundreds of cases of impotence in the valley.

Peer is not writing about a remote past; torture and extrajudicial execution remain commonplace in Kashmir today, even though Pakistan-trained or indigenous militants are fewer and less lethal. Nor have India and Pakistan gotten any closer to resolving their dispute over the region. Pakistani army and intelligence officers loudly invoke the alleged existential threat from India, helping them to preserve the ISI’s extra-constitutional authority (and business monopolies) in Pakistan and severely limiting the prospects for democracy and equitable economic growth.

Kashmir also exacts a great price from India, which is still overwhelmingly poor despite its fast-growing GDP, while radicalizing many among the country’s 150 million Muslims. The Chennai daily, The Hindu, revealed last month that Pakistani militants demanding the Indian army’s withdrawal from Kashmir during the four-day terror attack on Mumbai in November 2008 were being prompted via their mobile phones by an Indian Muslim, who advised them to call the media to condemn India’s “two-faced” policy toward Muslims. The new round of talks could be derailed by another terrorist attack in India—such as the one last month that killed 15 Indians and foreigners in the Western Indian city of Pune—or against an Indian target in Afghanistan.

In any case, the Obama administration doesn’t seem much interested in slowing or reversing the arms buildup in South Asia—the necessary prelude to peace in the region—as it promotes major arms deals with both India and Pakistan. As is well known, the Pakistani army under General Pervez Musharraf eagerly appropriated for their own purposes the $10 billion in aid showered on Pakistan by the Bush administration after September 11. Beholden for his survival to the army and the ISI, Pakistan’s president Asif Ali Zardari seems far from renouncing the venal ways that earned him long spells in prison. Nevertheless, American military sales to Pakistan, paid for with aid money, will increase almost two-fold next year. Meanwhile, American defense firms like Lockheed Martin and Boeing are currently vying for the world’s biggest weapons contracts from India, which is racing to modernize its military.

Almost entirely exempt from parliamentary debate or public scrutiny, the unprecedented expansion of India’s defense budget, which rose 34 percent last year, is a bonanza for the country’s alarmingly numerous corrupt politicians, bureaucrats and army officers. The consensus on defense spending is facilitated by an increasingly right-wing press that is constantly raising the alarm about various external and internal enemies. There are, as the political scientist Sunil Khilnani recently warned, grounds to fear the emergence in India of a “military-industrial complex”—especially while the Indian state, as Khilnani points out, is at war with its own people in Central India: the Mao-inspired guerillas who have organized India’s traditionally disadvantaged tribal communities and low-caste peasants into a militant movement spanning 20 of India’s 28 states.

The apparent failure of an ambitious counterinsurgency campaign called “Operation Green Hunt” has recently forced the Indian government to propose ceasefire talks with the “Maoists.” As politicians and columnists frequently point out, “they are our own people.” But no such magnanimity may be extended to the 4 million Kashmiri Muslims who many Indians regard as blatantly treasonous after twenty years of anti-India, Pakistan-supported militancy.

Of course most Kashmiris, weary of both radical Islamists from Pakistan and Indian security forces, long to be free of their overbearing neighbors. But even before its recent jingoistic phase, Indian press and television tended to obscure the clear Kashmiri demand for self-determination, preferring to highlight the depredations of Islamic fundamentalists. The complexity of the conflict as well as strictures on travel continue to inhibit foreign reporters from covering what Bill Clinton in 2002 described as the “world’s most dangerous place.”

More disturbingly, a generation that has grown up in the shadow of the insurgency may soon be provoked into a new cycle of extreme violence. Scantily reported in the Indian and international press, Kashmir has been paralyzed for the last two weeks by strikes and clashes between police and young Kashmiri Muslims angered by the alleged killing of two unarmed teenagers by Indian soldiers. The possibility of participating in India’s growing economy will only partly defuse the fresh rage and frustration of these youths: they may prove to be no less compromising than their predecessors—Basharat Peer’s generation—who took up arms against the Indian state. No doubt Pakistani army and intelligence officials are watching them with interest, especially as talks between India and Pakistan go nowhere and the two countries embark upon their costliest arms race yet.

Basharat Peer, Curfewed Night: One Kashmiri Journalist’s Frontline Account of Life, Love, and War in His Homeland (Scribner, 2010)