India and Pakistan, two nuclear-armed neighbours, have vital stakes in maintaining strategic stability in South Asia. However, some disturbing shifts are now being observed in India’s approach towards the imperatives of strategic stability. Its aggressive pursuit of military modernisation and acquisition of emerging technologies, coupled with reported doctrinal shifts, such as pre-emptive counterforce strategy, pose a serious challenge to nuclear deterrence. The Indian leadership seems to have been emboldened by the US tilt towards India, manifested by the growing US-India strategic partnership. These developments have heightened Pakistan’s sense of insecurity. This essay seeks to assess the short-, medium- and long-term challenges to strategic stability in South Asia. It suggests a three-tiered framework of confidence-building measures at the bilateral level between India and Pakistan, the trilateral level among China, India and Pakistan, and the multilateral level whereby the major powers could facilitate conventional and nuclear confidence-building measures in the region.