Pakistan and Iran are neighbouring countries with volatile ties, triggered more by the recent back-and-forth military attacks on each other’s territories. Pakistan and Iran share a 900-kilometer border, well-known for its notorious smugglers and bypassers. On top of that, the presence of the ‘Iranian militant group’ Jaish-al-Asad in Balochistan is a bone of contention between the two nations. The recent unprovoked violation of Pakistani airspace by Iranian forces was considered a direct violation and a tit-for-tat response by Pakistani militia was given by striking Iranian territory. Pakistan claims that anti-Pakistan ethno-nationalist insurgents are operating from Iranian soil. Both sides asserted they targeted terrorists on the other’s side, but the debacle resulted in international concerns since the two neighbours were on the brink of a potential war-like situation. The claims saying prior coordination was done between the two countries about the targeted attacks on January 16 is also a testament to the undecided relationship between the states. A Telegram channel seen as close to Iran’s elite Islamic Revolutionary Guard Corps (IRGC) wrote on Jan. 18, “The attack on terrorist positions in Pakistan required coordination with the Pakistani government, which took place…this week.” There is a consensus in the two capitals that coordinated intelligence-driven initiatives aimed at extremists are long overdue. The conflict is as much about internal issues as it is about external stakeholders. The matchup between the two countries within the next week also raised questions as to the intentions behind these ups and downs. Whilst the attacks ignited a tinderbox, the recent talks and mediation between the foreign ministries resulted as a coolant. Keep in mind that this region is a strategic focal point for stakeholders like the US, China and India. India has recently tried to be an Iranian ally to counter Pakistan from its western front too, while China acted as a mediator between the two nations in resolving the missile attacks issue. This shows the readiness of foreign actors in involved within this region. Notably, the threat against foreign meddling coincides with reports that China and Saudi Arabia have independently offered to arbitrate this dispute between Iran and Pakistan. Furthermore, Iran intends to file an $18 billion lawsuit against Pakistan in the Paris-based International Arbitration if Islamabad fails to move on with the Iran-Pakistan (IP) gas pipeline project, for which Tehran has extended the deadline by 180 days, until September 2024. This may strain the relationship between the two states further. Pakistan believes that the project has enormous potential. It claims to provide a safe and affordable supply of natural gas, easing the nation’s ongoing energy problems and stimulating the economy. The project’s advancement has been made more difficult by concerns about Iranian sanctions and the possibility of regional instability, which have caused unease inside the Pakistani administration. Pakistan is in a vulnerable situation. Despite acknowledging the IP pipeline’s financial advantages, it still has a long way to go. Concerns about regional security and possible fallout from surrounding nations cannot be disregarded, and the prospect of US sanctions on any organisation associated with the project continues to be a significant deterrent. In an effort to establish a diplomatic settlement, the Pakistani administration is actively interacting with both Iran and the United States. The Ebrahim Raisi government appears to have first reported on the Jan. 16 operation inside Pakistan through Iran’s official IRNA news agency. But before other media noticed, IRNA swiftly withdrew the report without providing an explanation. Fars and Tasnim, two news organisations connected to the IRGC, appear to have announced the strike only afterwards. On the other hand, the IRGC quickly released three public statements following its January 15th targets’ strikes in Syria and Iraq. Furthermore, the IRGC has not yet made a formal statement regarding the strikes within Pakistan. This may be seen as a step towards damage control to ensure that no further enmity is created between the two states and their peoples. The two neighbours decided to implement three distinct techniques to counteract cross-border attacks by extremist organisations, and they intend to start on January 29. First, an operational hotline between senior civilian officials and military commanders will be established; second, one military liaison officer from each of Pakistan and Iran will be stationed in the bordering towns of Taftan and Turbat; and third, real-time intelligence information regarding cross-border attacks will be frequently shared. There is a consensus in the two capitals that coordinated intelligence-driven initiatives aimed at extremists are long overdue. Tehran was experiencing growing pressure after the Islamic State attacks earlier in January, on top of that its involvement in the Israel conflict has further been a challenge for Hamas, Iran and its theocracy, thus Iran needs all the support it can get. Seeing this Iran struck a conciliatory tone in its statement on January 18 by referring to Pakistan as a “friend and brother.” For Pakistan’s part, it has seen Iran as a difficult and not very useful neighbour due to its pariah status in the West but in prolonging the conflict, Pakistan could have risked triggering a long-term, three-front dilemma involving Afghanistan, India and Iran. The writer is a Researcher at the Islamabad Policy Research Institute, IPRI