The Indo-Pak war of 1971 had reasons much beyond Jammu and Kashmir as Pakistan failing to have its administrative control over East Pakistan resorted to brutal force on the population leading a mass exodus of people from East Pakistan to India, particularly West Bengal. While Pakistan's military establishment realised that it cannot retain hold over East Pakistan it tried to compensate the loss by capturing territory inside Jammu and Kashmir.
Ever since partition the people of East Pakistan (now Bangladesh) had a grudge that they were being ignored by the Pakistani masses and leaders. They belived that their rightful claim to governance was being thwarted by politicians from West Pakistan. There was a feeling that the military leadership in West Pakistan and its politicians were out to impose their wishes on the population of East Pakistan.
The desperation among the people of East Pakistan was further fuelled by the formation of Sheikh Mujibur Rehman's Awami League, who favoured seperation of East Pakistan. The Awami League secured a clear majority in the 1971 elections of Pakistan. Still, its leader Mujibur Rehman was deprived of the Pakistan's Prime Ministership following opposition from leaders in West Pakistan.
The Awami League and Mukti Vahini a local mass movement in East Pakistan perturbed by the developments announced independence from Pakistan naming the state as Bangladesh. This resulted in a bloody confrontation between the Pakistan army and people of Bangladesh resulting in mass migration of about a million people into Indian territories.
The migrant problems assumed alarming proportions affecting the economic condition of West Bengal besides, resulting in a huge humanitarian crisis. It was at this juncture that India decided to side with the Bangladeshi locals in their struggle for liberation.
With stiff resistance from local population, Pakistan realised that it would be impossible for it to retain control over East Pakistan and it decided to compensate the loss of territory by securing Kashmir. Pakistan resorted to pre-emptive strikes on Indian air bases in the Western and Northern sectors of December 3, 1971 resulting in a full scale war. Indian armed forces repulsed persistent Pakistani attempts to push into Jammu and Kashmir state and capture the valley.
The Indian army also inflicted a crushing defeat on Pakistan in Sindh and Lahore sectors. Pakistan navy and Karachi port were paralysed after Indian navy surrounded it. Lahore was besieged and 5,000 sq. miles of Pak territory in Lahore sector was occupied while the Pakistan army could capture only 60 sq. miles of Indian territory in the Chhamb sector in Jammu region of Jammu and Kashmir. In the Eastern sector the Pakistan army surrendered to India's might and Indian army took more that 90,000 Pakistani troops as prisoners of war.
The decisive win for Indian forces in the 1971 resulting in the disemberment of Pakistan and liberation of Bangladesh, with over 90,000 Pakistani soldiers as prisoners and over one-third of Pakistani territory, India was in the most advantageous position to settle all the outstanding issues including Kashmir with Pakistan, once and for all. But, as history would suggest India frettered away the advantage at the negotiating table during the Shimla agreement.
A dejected and cornored Zulfiqar Ali Bhutto, the then Pakistan President pleaded to the Indian establishment more time to settle Kashmir issue citing political compulsions back home and violent reactions including threat to his life. The Indians gave in to Bhutto's plea and once back in Pakistan, Bhutto never kept his word, rather he raised the rhetoric over Jammu and Kashmir.