"Pakistan's external environment will remain challenging throughout 2020 which will have serious implications for its economy, security and internal stability," said the report.
The situation in Kashmir and plight of the Muslims in India will guide Pakistan's engagement with Delhi. Chances of limited conflict between India and Pakistan would remain high, added.
Tensions between India and Pakistan have spiked since India abrogated Article 370 of the Constitution to revoke the special status of Jammu and Kashmir in August last year. India's decision evoked strong reactions from Pakistan, which downgraded diplomatic ties and expelled the Indian envoy.
India has categorically told the international community that the scrapping of Article 370 was its internal matter. It also advised Pakistan to accept the reality and stop all anti-India propaganda.
The report by Islamabad Policy Institute was reviewed after analysing the current trends in external environment, economy, political stability, and security and on the basis of that made short-term projections in these areas.
In the report, the Foreign policy aspect has been analysed by former foreign secretary Salman Bashir, while the military dimension has been dealt with by former defence secretary retired Lt Gen Asif Yasin Malik.
Economist Syed Hussain Haider evaluated the economic situation and Farhan Bokhari assessed the prospects of political stability, the paper reported.
"The foremost threat to Pakistan's security from India has become dire with transformation of India as a Hindu state under the Bharatiya Janata Party," Bashir in the report alleged.
"US support for India, while ignoring Delhi's reckless behaviour was in violation of all norms of civility, international norms and principles," he said in the report.
The report also highlighted that navigating China-US competition will test craft of Pakistani policy-makers in near term.
"This would, moreover, strain Pakistan-US ties while complicating regional environment from Pakistan's perspective," it said.
About ties with the US, it said, it is a near certainty that bilateral engagement will remain limited to the minimum agenda of Afghanistan for foreseeable future and transactional nature of the relationship will continue," the paper reported.
On the economic front, the report projected that Pakistan's GDP growth would remain close to 2.5 per cent because of slowdown specifically in large scale manufacturing and agriculture sectors.
Economist Bokhari believes that as long as party structures remain weak and led by families where highest offices have passed on in a hereditary manner, political parties will remain inherently weak and unable to meaningfully contribute to the discourse on key policy issues.
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