Iran's top diplomat in Pakistan to mediate in the escalation with India over the Kashmir attack

ISLAMABAD (AP) — Iran’s foreign minister held talks with top Pakistani officials on Monday to try and mediate in the escalation between Islamabad and New Delhi after last month’s deadly attack on tourists in the Indian-controlled part of Kashmir, as the United Nations urged both sides to exercise restraint.

Abbas Araghchi's visit to Islamabad was the first by a foreign dignitary since tensions flared in the wake of the April 22 massacre of 26 people, most of them Indian Hindu tourists, in the town of Pahalgam, which India blames on Pakistan. Islamabad denies the accusation.

Tehran has offered to help ease tensions between the nuclear-armed neighbors.

Araghchi held separate meetings with President Asif Ali Zardari and Prime Minister Shehbaz Sharif, who thanked him for his peace efforts, according to government statements. Araghchi will visit India this week, according to Pakistani state-run media.

Antonio Guterres, the U.N. Secretary General, also urged both sides later Monday to exercise restraint: “Make no mistake: A military solution is no solution,” he told reporters.

"Now is the time for maximum restraint and stepping back from the brink,” Guterres said. “The United Nations stands ready to support any initiative that promotes de-escalation, diplomacy, and a renewed commitment to peace.”

Islamabad has offered to cooperate with an international investigation. India hasn’t accepted the offer so far, and several world leaders have urged both sides to show restraint and avoid further escalation.

Pakistan's military has been on high alert after Cabinet Minister Attaullah Tarar cited intelligence indicating that India could attack.

Foreign Minister Ishaq Dar said in televised remarks Monday that Pakistan “will exercise full restraint, but if India takes any adventurous step, then we will give a befitting response.”

According to a ministry statement, Dar, in talks with Araghchi, rejected what he described as India’s attempts to implicate Pakistan in the Kashmir attack.

Dar had earlier welcomed mediation to defuse the tensions with India. Since last week, he said that he's spoken to more than a dozen foreign dignitaries, including U.S. Secretary of State Marco Rubio and Russian Foreign Minister Sergey Lavrov.

“We will not be the first to take any escalatory step,” Dar said, adding that he had warned the international community should there be “any act of aggression by India, Pakistan will resolutely defend its sovereignty and territorial integrity.”

He also accused the Indian air force of attempting to breach Pakistani airspace on April 29. Pakistan scrambled aircraft and forced Indian jets to turn back, he said. There was no immediate comment from India on those claims.

Pakistani Information Minister Attaullah Tarar led Monday a group of journalists to the mountain village of Bella Noor Shah, near Muzaffarabad — the main city in Pakistan-administered Kashmir — where he said that New Delhi had falsely claimed the presence of a militant training camp.

Residents of the village told reporters they had never seen any such camp in the area.

Meanwhile, Indian Foreign Ministry spokesperson Randhir Jaiswal wrote on X that Russian President Vladimir Putin spoke with Indian Prime Minister Narendra Modi on Monday and “strongly condemned the terror attack in Pahalgam."

Pakistan’s military said Monday that it test fired a short-range missile, the second such test launch after a medium-range missile on Saturday.

The military said that the Fatah surface-to-surface missile has a range of 120 kilometers (75 miles) and was launched from an undisclosed location. Such missiles are never fired toward India, and usually end up reaching the Arabian Sea or the deserts of southern Balochistan province

Kashmir is split between India and Pakistan and claimed by both in its entirety. The two countries have fought two of their three wars over the Himalayan region and their ties have been shaped by conflict, aggressive diplomacy and mutual suspicion, mostly because of their competing claims over Kashmir.

Militants in the Indian-controlled portion of Kashmir have been fighting New Delhi’s rule since 1989. Many Muslim Kashmiris support the rebels’ goal of uniting the territory, either under Pakistani rule or as an independent country.

Mushaal Hussein, the wife of a top Kashmiri rebel leader, Mohammed Yasin Malik, accused India of falsely implicating Pakistan in the attack on tourists. She made her remarks Monday after attending a flag-lowering ceremony, a dramatic daily show of strength on both sides of the border. Malik, who is imprisoned in India on terror charges, married her in Pakistan in 2009.

The latest flare-up led the two countries to expel each other’s diplomats and nationals, as well as the shuttering of airspace.

Dar, Pakistan's foreign minister, denounced India's unilateral decision to suspend a water-sharing treaty.

In the town of Akhnoor in Indian-controlled Kashmir, where the Chenab River flows into Pakistan, residents said that water levels were so low, people could walk across the river on Monday.

“I have never seen this river dry in my life,” said 55-year-old farmer Bal Krishan, adding that he agreed with “Modi’s decision to suspend the treaty and punish” Pakistan.

There was no immediate comment from officials.

Muhammad Yousaf reported from Muzaffarabad. Farnoush Amiri at the United Nations, Rajesh Roy in New Delhi, Channi Anand in Akhnoor, India, and Ishfaq Hussain in Muzaffarabad, Pakistan, contributed to this report.

Pakistan's Rangers soldiers, in black, and Indian Border Security Forces soldiers, behind the gate, stand guard during a daily closing ceremony at the Wagah, a joint post on the Pakistan and India border, near Lahore, Pakistan, Monday, May 5, 2025. (AP Photo/K.M. Chaudary)

Pakistan's Rangers soldiers, in black, and Indian Border Security Forces soldiers, behind the gate, lower their flags during a daily closing ceremony at the Wagah, a joint post on the Pakistan and India border, near Lahore, Pakistan, Monday, May 5, 2025. (AP Photo/K.M. Chaudary)

Indian Border Security Forces soldiers gesture during a daily closing ceremony at the Wagah, a joint post on the Pakistan and India border, near Lahore, Pakistan, Monday, May 5, 2025. (AP Photo/K.M. Chaudary)

Pakistan's Rangers soldiers, bottom, and Indian Border Security Forces soldiers, top, march during a daily closing ceremony at the Wagah, a joint post on the Pakistan and India border, near Lahore, Pakistan, Monday, May 5, 2025. (AP Photo/K.M. Chaudary)

Pakistan's Rangers soldiers march during a daily closing ceremony at the Wagah, a joint post on the Pakistan and India border, near Lahore, Pakistan, Monday, May 5, 2025. (AP Photo/K.M. Chaudary)

Pakistan's Rangers soldiers, in black, and Indian Border Security Forces soldiers, behind gate, gesture each others during a daily closing ceremony at the Wagah, a joint post on the Pakistan and India border, near Lahore, Pakistan, Monday, May 5, 2025. (AP Photo/K.M. Chaudary)

Pakistan's Rangers soldiers, in black, and Indian Border Security Forces soldiers, behind the gate, lower their flags during a daily closing ceremony at the Wagah, a joint post on the Pakistan and India border, near Lahore, Pakistan, Monday, May 5, 2025. (AP Photo/K.M. Chaudary)

Pakistan's Rangers soldiers, in black, and Indian Border Security Forces soldiers, behind the gate, parade during a daily closing ceremony at the Wagah, a joint post on the Pakistan and India border, near Lahore, Pakistan, Monday, May 5, 2025. (AP Photo/K.M. Chaudary)

Mushaal Hussein, right, the wife of a top Kashmiri rebel leader, Mohammed Yasin Malik, talks to media as her daughter Razia Sultan watches, at the Wagah, a joint post on the Pakistan and India border, near Lahore, Pakistan, Monday, May 5, 2025. (AP Photo/K.M. Chaudary)

Pakistan's Rangers soldiers, bottom, and Indian Border Security Forces soldiers, top, parade during a daily closing ceremony at the Wagah, a joint post on the Pakistan and India border, near Lahore, Pakistan, Monday, May 5, 2025. (AP Photo/K.M. Chaudary)

Mushaal Hussein, center, the wife of a top Kashmiri rebel leader, Mohammed Yasin Malik, talks to media as her daughter Razia Sultan, left, watches, at the Wagah, a joint post on the Pakistan and India border, near Lahore, Pakistan, Monday, May 5, 2025. (AP Photo/K.M. Chaudary)

People cross the Chenab River after the flow of water was halted from a dam, at Akhnoor, on the outskirts of Jammu, India, Monday, May 5, 2025. (AP Photo/Channi Anand)

A boat stands still at the dry Chenab river after the water was halted from a dam, at Akhnoor, on the outskirts of Jammu, India, Monday, May 5, 2025. (AP Photo/Channi Anand)

People cross the Chenab River after the flow of water was halted from a dam, at Akhnoor, on the outskirts of Jammu, India, Monday, May 5, 2025. (AP Photo/Channi Anand)

Pakistan's Rangers soldiers, bottom, and Indian Border Security Forces soldiers, top, parade during a daily closing ceremony at the Wagah, a joint post on the Pakistan and India border, near Lahore, Pakistan, Monday, May 5, 2025. (AP Photo/K.M. Chaudary)

Pakistan's Rangers soldiers, in black, and Indian Border Security Forces soldiers, behind the gate, lower their flags during a daily closing ceremony at the Wagah, a joint post on the Pakistan and India border, near Lahore, Pakistan, Monday, May 5, 2025. (AP Photo/K.M. Chaudary)

In this photo, released by the Pakistan's Ministry of Foreign Affairs, Iran's Foreign Minister Abbas Araghch, left, shakes hand with his Pakistan's Foreign Minister Ishaq Dar, right, prior to their meeting in Islamabad, Pakistan, Monday, May 5, 2025. (Pakistan Ministry of Foreign Affairs via AP)

Students attend their class in Aligarh School and College of Commerce and Science in Dara Batang during a government's organized trip for media to Bella Noor Shah, a mountainous village near Muzaffarabad, the capital of Pakistan administered Kashmir, Monday, May 5, 2025. (AP Photo/Muhammad Yousuf, Pool)

Supporters of Pasban-e-Hurriyat Jammu and Kashmir chant slogans next to burning tires during an anti-India demonstration, in Muzaffarabad, the capital of Pakistan administered Kashmir, Monday, May 5, 2025. (AP Photo/M.D. Mughal)

Supporters of Pasban-e-Hurriyat Jammu and Kashmir chant slogans during an anti-India demonstration, in Muzaffarabad, the capital of Pakistan administered Kashmir, Monday, May 5, 2025. The placard in the center reads "Jammu and Kashmir want idepdendenoe from India". (AP Photo/M.D. Mughal)

Supporters of Pasban-e-Hurriyat Jammu and Kashmir hold an anti-India demonstration, in Muzaffarabad, the capital of Pakistan administered Kashmir, Monday, May 5, 2025. (AP Photo/M.D. Mughal)

Supporters of Pasban-e-Hurriyat Jammu and Kashmir chant slogans during an anti-India demonstration, in Muzaffarabad, the capital of Pakistan administered Kashmir, Monday, May 5, 2025. (AP Photo/M.D. Mughal)

A villager walks through a wheat field during a government's organized trip for media to Bella Noor Shah, a mountainous village near Muzaffarabad, the capital of Pakistan administered Kashmir, Monday, May 5, 2025. (AP Photo/Muhammad Yousuf, Pool)

A cameraman records an interview with a villager during a government's organized trip for media to Bella Noor Shah, a mountainous village near Muzaffarabad, the capital of Pakistan administered Kashmir, Monday, May 5, 2025. (AP Photo/Muhammad Yousuf, Pool)

Pakistan's Information Minister Attaullah Tarar, center, briefs journalists during a government's organised trip for media to Bella Noor Shah, a mountainous village near Muzaffarabad, the capital of Pakistan administered Kashmir, Monday, May 5, 2025. (AP Photo/Muhammad Yousuf, Pool)

Villager women walk on a dusty track during a government's organized trip for media to Bella Noor Shah, a mountainous village near Muzaffarabad, the capital of Pakistan administered Kashmir, Monday, May 5, 2025. (AP Photo/Muhammad Yousuf, Pool)

Pakistan's Information Minister Attaullah Tarar, center, briefs journalists during a government's organized trip for media to Bella Noor Shah, a mountainous village near Muzaffarabad, the capital of Pakistan administered Kashmir, Monday, May 5, 2025. (AP Photo/Muhammad Yousuf, Pool)

Students attend their class in Aligarh School and College of Commerce and Science in Dara Batang during a government's organized trip for media to Bella Noor Shah, a mountainous village near Muzaffarabad, the capital of Pakistan administered Kashmir, Monday, May 5, 2025. (AP Photo/Muhammad Yousuf, Pool)

A student walks towards the Aligarh School and College of Commerce and Science in Dara Batang during a government's organized trip for media to Bella Noor Shah, a mountainous village near Muzaffarabad, the capital of Pakistan administered Kashmir, Monday, May 5, 2025. (AP Photo/Muhammad Yousuf, Pool)

FILE - Indian security officers inspect the site where militants indiscriminately opened fired on tourists on Tuesday, in Pahalgam, Indian controlled Kashmir, Wednesday, April 23, 2025. (AP Photo, File)

Villager walk on a dusty track during a government's organized trip for media to Bella Noor Shah, a mountainous village near Muzaffarabad, the capital of Pakistan administered Kashmir, Monday, May 5, 2025. (AP Photo/Muhammad Yousuf, Pool)

FILE - An Indian paramilitary soldier walks past graffiti on a wall in Srinagar, Indian-controlled Kashmir, Aug. 29, 2016. (AP Photo/Dar Yasin, File)

Pakistan's Rangers soldiers, in black, and Indian Border Security Forces soldiers, lower their flags during a daily closing ceremony at the Wagah, a joint post on the Pakistan and India border, near Lahore, Pakistan, Saturday, May 3, 2025. (AP Photo/K.M. Chaudary)

Farmers participate in a rally against the suspension of a water-sharing treaty by India, in Lahore, Pakistan, Sunday, May 4, 2025. (AP Photo/K.M. Chaudary)

Supporters of Muttahida Qabail Federation party burn a rendition of the Indian flag and poster with the picture of Indian Prime Minister Narendra Modi during a demonstration in Quetta, Pakistan, Sunday, May 4, 2025. (AP Photo/Arshad Butt)

NEW YORK (AP) — Reviving a campaign pledge, President Donald Trump wants a one-year, 10% cap on credit card interest rates, a move that could save Americans tens of billions of dollars but drew immediate opposition from an industry that has been in his corner.

Trump was not clear in his social media post Friday night whether a cap might take effect through executive action or legislation, though one Republican senator said he had spoken with the president and would work on a bill with his “full support.” Trump said he hoped it would be in place Jan. 20, one year after he took office.

Strong opposition is certain from Wall Street in addition to the credit card companies, which donated heavily to his 2024 campaign and have supported Trump's second-term agenda. Banks are making the argument that such a plan would most hurt poor people, at a time of economic concern, by curtailing or eliminating credit lines, driving them to high-cost alternatives like payday loans or pawnshops.

“We will no longer let the American Public be ripped off by Credit Card Companies that are charging Interest Rates of 20 to 30%,” Trump wrote on his Truth Social platform.

Researchers who studied Trump’s campaign pledge after it was first announced found that Americans would save roughly $100 billion in interest a year if credit card rates were capped at 10%. The same researchers found that while the credit card industry would take a major hit, it would still be profitable, although credit card rewards and other perks might be scaled back.

About 195 million people in the United States had credit cards in 2024 and were assessed $160 billion in interest charges, the Consumer Financial Protection Bureau says. Americans are now carrying more credit card debt than ever, to the tune of about $1.23 trillion, according to figures from the New York Federal Reserve for the third quarter last year.

Further, Americans are paying, on average, between 19.65% and 21.5% in interest on credit cards according to the Federal Reserve and other industry tracking sources. That has come down in the past year as the central bank lowered benchmark rates, but is near the highs since federal regulators started tracking credit card rates in the mid-1990s. That’s significantly higher than a decade ago, when the average credit card interest rate was roughly 12%.

The Republican administration has proved particularly friendly until now to the credit card industry.

Capital One got little resistance from the White House when it finalized its purchase and merger with Discover Financial in early 2025, a deal that created the nation’s largest credit card company. The Consumer Financial Protection Bureau, which is largely tasked with going after credit card companies for alleged wrongdoing, has been largely nonfunctional since Trump took office.

In a joint statement, the banking industry was opposed to Trump's proposal.

“If enacted, this cap would only drive consumers toward less regulated, more costly alternatives," the American Bankers Association and allied groups said.

Bank lobbyists have long argued that lowering interest rates on their credit card products would require the banks to lend less to high-risk borrowers. When Congress enacted a cap on the fee that stores pay large banks when customers use a debit card, banks responded by removing all rewards and perks from those cards. Debit card rewards only recently have trickled back into consumers' hands. For example, United Airlines now has a debit card that gives miles with purchases.

The U.S. already places interest rate caps on some financial products and for some demographics. The Military Lending Act makes it illegal to charge active-duty service members more than 36% for any financial product. The national regulator for credit unions has capped interest rates on credit union credit cards at 18%.

Credit card companies earn three streams of revenue from their products: fees charged to merchants, fees charged to customers and the interest charged on balances. The argument from some researchers and left-leaning policymakers is that the banks earn enough revenue from merchants to keep them profitable if interest rates were capped.

"A 10% credit card interest cap would save Americans $100 billion a year without causing massive account closures, as banks claim. That’s because the few large banks that dominate the credit card market are making absolutely massive profits on customers at all income levels," said Brian Shearer, director of competition and regulatory policy at the Vanderbilt Policy Accelerator, who wrote the research on the industry's impact of Trump's proposal last year.

There are some historic examples that interest rate caps do cut off the less creditworthy to financial products because banks are not able to price risk correctly. Arkansas has a strictly enforced interest rate cap of 17% and evidence points to the poor and less creditworthy being cut out of consumer credit markets in the state. Shearer's research showed that an interest rate cap of 10% would likely result in banks lending less to those with credit scores below 600.

The White House did not respond to questions about how the president seeks to cap the rate or whether he has spoken with credit card companies about the idea.

Sen. Roger Marshall, R-Kan., who said he talked with Trump on Friday night, said the effort is meant to “lower costs for American families and to reign in greedy credit card companies who have been ripping off hardworking Americans for too long."

Legislation in both the House and the Senate would do what Trump is seeking.

Sens. Bernie Sanders, I-Vt., and Josh Hawley, R-Mo., released a plan in February that would immediately cap interest rates at 10% for five years, hoping to use Trump’s campaign promise to build momentum for their measure.

Hours before Trump's post, Sanders said that the president, rather than working to cap interest rates, had taken steps to deregulate big banks that allowed them to charge much higher credit card fees.

Reps. Alexandria Ocasio-Cortez, D-N.Y., and Anna Paulina Luna, R-Fla., have proposed similar legislation. Ocasio-Cortez is a frequent political target of Trump, while Luna is a close ally of the president.

Seung Min Kim reported from West Palm Beach, Fla.

President Donald Trump arrives on Air Force One at Palm Beach International Airport, Friday, Jan. 9, 2025, in West Palm Beach, Fla. (AP Photo/Julia Demaree Nikhinson)

FILE - Visa and Mastercard credit cards are shown in Buffalo Grove, Ill., Feb. 8, 2024. (AP Photo/Nam Y. Huh, File)