As events unfold in the aftermath of Kulbhushan Yadev’s arrest, it seems that Pakistan-Iran relations are reaching a heightened state of sensitivity. Behind the Interior Minister Chaudhary Nisar’s comments on the need to refrain from postulating Iranian culpability in Indian clandestine operations in Pakistan is a certain level of anxiety over incurring further Iranian disapproval. In light of this statement, certain claims that are afloat in the media over Indian-Iranian partnership need to be treated with extreme caution as they can exacerbate the situation. This is not to say that Pakistan should shy away from fighting its case if it has proof of the alleged nexus. However, if various factors of the diplomatic equation are taken into consideration, it would reveal that such claims are devoid of any real substance. Pakistan’s relationship with Iran has historically been amiable. While the revolution did result in the thinning of cordiality because of Pakistan’s close links with the Shah regime, the bilateral relationship never degenerated into outright animosity. Meanwhile, the common Islamic ties between the two countries have always provided the groundwork for mutual cooperation. However, one should be wary of overemphasising the Islamic link as realpolitik dictates the dominance of national self-interest over notions of Islamic universalism. More substantively, Iranian and Pakistani interests have been in unison over the Balochistan issue. Both the countries rule over territory that is home to ethnic Baloch people. Hence, in order to prevent separatist fires spreading into their respective territories, both countries have been in agreement over cooperation on the issue. In light of this, it would be absurd to believe that the Iranian government would be conspiring with India in supporting separatist elements in Balochistan. The recent lifting of economic sanctions as a result of the P5+1 agreement has given Iran renewed importance at the regional level. Different geo-strategic and economic factors have made the Asian continent into a mesh of fluid diplomatic manoeuvres. Popular belief continues to be that two opposing blocks — that of Pakistan-China and India-Iran — are emerging. The Chinese-sponsored Gawadar port and the India-financed Chabahar port are seen as evidence of political rivalry between the two powers. In actuality, however, things appear to be much more complex. Therefore, there is a need to place this popular belief in the much broader framework of the multilayered Iranian, Indian, and Chinese interests in order to better understand its mendacity. Iran’s mineral oil and petroleum resources have the potential of addressing both Indian and Chinese energy demands. This can be evidenced by Chinese eagerness to finance Pakistan’s part of the Iran-Pakistan gas pipeline since this can be further extended into China. In the meantime, as a result of the decade long sanctions, Iranian infrastructure is severely underdeveloped to meet the newly emerging export demand. The two most obvious sponsors in this regard could be India and China. Hence, Iran has to play its cards right if it is to take the most advantage from both Chinese and Indian patronage. This would involve not committing itself to hard alliances with either China or India. In fact, Chinese and Indian economic interests militate against hostility between the two powers. Bilateral trade between the two countries is estimated to be near 80 billion dollars, and this alone is enough reason for the two countries to keep things cordial. The region has hence moved away from the old understanding of a zero-sum game and it appears that economic considerations may usher in a new era of regional cooperation. This leaves Pakistan at the crossroads of a very fluidly transforming environment. Its geo-strategic importance can be ascertained by the fact that it lies in the middle of Iran, China, and India. Hence, it would fare well for Pakistan to refrain from adopting intransigent positions that may prevent it from taking full advantage of this multilateral nexus. While there can be no doubt of subversive activities by India on Pakistani soil, they must not be used as pretence for endangering the delicate Pakistan-Iran relationship. In the meantime, the Pakistani government should talk to Iran on an equal footing, while refraining from make making matters prematurely bitter. The relationship seems as tenuous as ever as Iran conducts its own investigation over whether Yadav was captured in Iran or Pakistan. However, the Iranian government’s cooperative gesture should allay fears of impending Iranian animosity. *