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Blinken is a seasoned diplomat. He's practical and reasonable when it comes to tempering the demands of various lobbies. However, there is only as much that he can do. Why? Because Kamala Harris and Joe Biden came to power (as much as it seems ridiculous) due to the votes of a combination of Liberal elitists, Jihadi radicals, Khalistani sympathizers & Pakistan's diaspora and lobby groups.Ultimately everything in foreign policy is about leverage a country holds.
coming to this specific point, it may take a year or two to find out what exactly this move means. But if we were to gaze thru the crystal, simplest explanation would be that US wants this chap to be there in Washington. by extension, this implies a segment (if not all) of Washington's foreign policy continue to have an interest in Kashmir. Blinken might be a good foreign policy practitioner, but he too will have to answer to lobby groups.
It is quite impressive that despite such lack of financial heft, economic clout or military relevance, Pakistan is able to retain a nexus against us; a country whose demographic is one of the most powerful in the US, monetarily, socially & very active politically. One look at the profiles of the various power brokers and it is clear that there are more pro-Modi govt than the "South Asian" libbus, despite the contrary image they portray.
There is simply no reason for approving Masood Khan's appointment as the ambassador than to send a message here - "you back us & we might be benign". Khan is not going to sit quietly once he enters the office. He has been designated as a diplomat for a reason and that is to rile up the issue so much that the US becomes like the UK vis-a-vis India.
Expect a lot of muck in the coming days. Which is why my concern is whether Jaishankar has an army ready to counter him diplomatically. He's going to need a lot of firepower in coming days dealing with the Big 3 countries, especially as the Ukraine Crisis worsens.