Return to Transcripts main page
Quest Means Business
Fears Grow Over Risk of Wider India-Pakistan Conflict; Conclave to Select New Pope Underway in Vatican City; Disney Announces a New Theme Park in Abu Dhabi. Pakistan Vows to Respond in Wake of Missile Attacked by India; U.S. Federal Reserve Holds Rates Steady; Bessent: Talks with China to Start Saturday in Switzerland. Aired 4-5p ET
Aired May 07, 2025 - 16:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
[16:00:12]
JIM SCIUTTO, CNN HOST: There is the closing bell. A muted reaction on Wall Street to today's Fed decision. The Dow and NASDAQ finished slightly
higher. Those are the markets and these are the main events.
Pakistan vows to respond to India's airstrikes. Both nations reported more deaths in the disputed region of Kashmir.
The Fed warns of rising economic risks.
And black smoke from the Vatican. Cardinals fail to elect a new Pope on the first day of the Conclave.
Live from Washington, it is Wednesday, May 7th. I am Jim Sciutto in today for Richard Quest and this is QUEST MEANS BUSINESS.
Good evening.
Tonight, Pakistan has authorized its military to retaliate against India, putting the countries on the brink of an expanded conflict over Kashmir. A
Pakistani military spokesperson says India's attack last night killed 31 people in Pakistan and Pakistan administered Kashmir. He said that number
includes the victims of airstrikes as well as firing along the line of control.
New satellite images show the aftermath of the strikes in Muridke, Pakistan. Pakistan's Defense Minister said it would only hit military
targets in India. An Indian Defense source says the shelling by Pakistan killed 12 people in India administered Kashmir.
Nic Robertson is in Islamabad and he joins me now.
Nic, as you listen to statements from Pakistani officials, do you hear them building up to a significant response here?
NIC ROBERTSON, CNN INTERNATIONAL DIPLOMATIC EDITOR: You can read it that way, Jim.
Look, I think there is a possibility, a tiny, narrow possibility of a potential off ramp. We can say that now. Look, it is 24 hours after those
strikes happened and I can say with a good degree of certainty right now to you that very senior government officials have had very little sleep in
that past 24 hours.
They've got to make the most momentous decisions for the country and for the next moves. They've met at National Security Committee level. They've
been able to analyze carefully what's happened, what was hit, what wasn't hit. Understand what that means. Obviously, not everything is shared
publicly.
So the dust, if you will, has settled, the rhetoric isn't. But at saying that, there hasn't been a counterstrike immediately, which would have been
massively escalatory, but we are not off the potential escalatory ramp now. The strikes began 24 hours ago.
(BEGIN VIDEOTAPE)
ROBERTSON (voice over): Just after midnight, Pakistan's peace shattered. A wave of Indian missiles lighting up the sky, rocking the nation. Pushing
two nuclear armed neighbors to the brink of all-out war.
Local resident, Waqas Ahmed (ph) saying fear and terror spread in the people. India says its attack hit nine sites as Pakistan's military mounted
its defense.
UNIDENTIFIED MALE: So far, I can confirm you that five Indian aircrafts, including three Rafale, one SU-30 and one MIG-29 have been shot down and
one Heron drone has also been shot.
ROBERTSON (voice over): According to India, the strikes were in response to last month's killing of 26 civilians in Kashmir by militants, India says
are from Pakistan, which Islamabad denies.
VIKRAM MISRI, INDIAN FOREIGN SECRETARY: These actions were measured, non- escalatory, proportionate and responsible. They focused on dismantling the terrorist infrastructure and disabling terrorists likely to be sent across
to India.
ROBERTSON (voice over): While India says it was preempting planned terror attacks, although provided no evidence of that claim.
Among the more than two dozen killed in Tuesday night's air raid were children. Mosques were damaged.
UNIDENTIFIED MALE: Pakistan!
ROBERTSON (voice over): An angered Pakistan has already vowed to respond.
LT. GEN. AHMED SHARF CHAUDHRY, PAKISTANI MILITARY SPOKESPERSON: Pakistan reserves the right and will respond to this aggression at a time, place and
means of our own choice.
[16:05:02]
ROBERTSON (voice over): Deadly artillery shelling continues across the de facto border in disputed Kashmir.
India warned Pakistan not to take it further.
COLONEL SOFIYA QURESHI, INDIAN ARMY: It must be said that the Indian Armed Forces are fully prepared to respond to Pakistani misadventures, if any,
that will escalate the situation.
ROBERTSON (voice over): The country's leader, Narendra Modi, gathered his top officials on Wednesday in the wake of the strikes, which hit deeper
inside Pakistan than any Indian attack for 50 years, long before either nation acquired the nuclear bomb.
(END VIDEOTAPE)
ROBERTSON (on camera): There has been so many Pakistani officials speaking today. The spokesman for the Army, multiple times, coming on different
channels. The Defense Minister speaking, the Prime Minister. But I think the thing that caught my eye was about three hours ago, the Prime Minister
giving an address to the nation and it is very much on the theme of what you've just heard there.
But he said this. He said: India has to pay. India has to pay. The blood of our martyrs will be avenged in the time and place of our choosing, as we as
we've heard other officials say that.
I think one of the things that stands out to me today, Jim, that we heard from the head of a proscribed terrorist organization, Jaish-e-Mohammed, he
spoke about what happened to him. He said that his facility was hit and that ten of his family members, including children, were killed. But this
is -- he is the head of a proscribed terrorist organization that actually claimed responsibility for the 2019 killing of 40 Indian security members
inside Indian controlled Kashmir.
He is proscribed not just by the U.S., the U.K., the E.U., the U.N., but by Pakistan as well. It seems if he is accurate in what he says, that it was
his premises, he has a track record of attacking India and he has a continuing track record, his most recent Telegram postings are also
threatening to India, and India appears to have targeted him.
SCIUTTO: Yes. I mean, it would seem that would be one of the terror targets that India seems to be claiming, perhaps.
Nic Robertson in Islamabad, thanks so much.
Well, nations around the world are calling for restraint. U.S. Secretary of State Marco Rubio spoke to the National Security advisers from both India
and Pakistan. He urged them both to avoid escalation and to keep lines of communication open.
China says it is concerned about the current developments, noting that both Pakistan and India are its neighbors. Sir Adam Thompson was the British
High Commissioner to Pakistan. He was also the U.K. Permanent Representative to NATO, now a senior associate fellow at the European
Leadership Network.
Sir Thompson, thanks so much for joining.
SIR ADAM THOMPSON, FORMER BRITISH HIGH COMMISSIONER TO PAKISTAN: A pleasure. Thank you.
SCIUTTO: So first, I wonder as you listen to those public comments from Pakistani officials, India, "has to pay." Pakistan "will respond." Although
the Defense Minister told CNN earlier today that it is trying to avoid a cross-border attack here. Should we all but expect that there will be a
response, a military response from Pakistan?
THOMPSON: Yes, I am afraid although Pakistani government figures will be desperately keen to avoid escalation, they really have no choice about
responding militarily in some fashion.
The public pressure, the pressure from the Pakistan military, the need to visibly bolster Pakistani deterrence since Pakistan's own territory has now
been hit by Indian missiles, a different dynamic from what happened in 2019, all of these things push towards a Pakistani response.
The question is whether they can calibrate that response in a way that allows India to feel that honor is satisfied and that New Delhi does not
have to respond in turn.
Unfortunately, there is no obvious off ramp for the two protagonists.
SCIUTTO: So what would be -- help us imagine what would be a non-escalatory response from Pakistan here? And again, we should always note that what is
non-escalatory to Pakistan might be interpreted differently from India. But are there outlines here given that there have been many conflicts like this
over the past 20 some odd years, limited conflicts. What could keep this from expanding further?
THOMPSON: There is very little that really keeps it from expanding further, except the two sides information control.
[16:10:10]
They both need to demonstrate firmness to their own public, and so there is a massive amount of disinformation going on that may actually be helpful
for de-escalation. That's what I think is happening with the Pakistani claim to have shot down five Indian aircrafts. That gives them more space
in a sense to do less against India, but it is very troubling that they say that they will strike Indian military targets because the Indians have been
very careful not to strike Pakistani military targets.
So there is potential for escalation there, and my own feeling is that it will require international pressure, diplomacy from outside, sort of
overwhelming pressure on the two sides to persuade them to back down. Possibly the United States, although Washington is not looking very engaged
at the moment; possibly a combination of China and Gulf states might help.
SCIUTTO: Who is the most credible mediator in recent experience between India and Pakistan?
THOMPSON: It is probably the United States, which has tolerably good relations with both sides. Britain is not brilliantly well-placed although
it has a role to play, but it has got so much history with the two countries that complicate things.
We've just seen the Iranian Foreign Minister in both New Delhi and Islamabad, and perhaps Iran hopes to play a role and might be able to do
something, but I think it will take more weight than Iran can bring to bear.
SCIUTTO: Sir Adam Thompson, we appreciate you joining.
THOMPSON: Thank you.
SCIUTTO: Well, the Federal Reserve holds interest rates steady for a third straight time. Chairman Jerome Powell says it is waiting for more clarity
when it comes to the impact of Trump's tariffs. We will take a look, coming up.
(COMMERCIAL BREAK)
SCIUTTO: The U.S. Federal Reserve appears to be taking a wait and see approach to the economic effect of tariffs. The Fed held interest rates
steady today for the third time in a row. President Trump's trade war has led to a great deal of economic uncertainty. The job market though remains
strong, inflation still falling. However, the economy did contract slightly in the first quarter.
[16:15:13]
Fed chair Jerome Powell says the economy is still in a solid position, and that the Fed will not rush to react to tariffs.
(BEGIN VIDEO CLIP)
JEROME POWELL, U.S. FEDERAL RESERVE CHAIRMAN: The risks of -- the risks of higher unemployment and higher inflation have risen, but they haven't
materialized yet. They really haven't. They're not really not in the data yet. And that tells me more than my intuition because I think it is
obvious, actually, that the right thing for us to do is we are in a good place. Our policy is in a very good place, and the right thing to do is
await further clarity.
(END VIDEO CLIP)
QUEST: Matt Egan joins us now from Washington. And, Matt, I think it is fair to say, it is somewhat of a mixed report, right, because you read the
statement, it says economic activities continue to expand at a solid pace, but uncertainty about the economic outlook has increased further, and as we
heard the Fed Chair say there, the risk of both higher unemployment and higher inflation has risen, though we haven't seen it yet.
I mean, is it correct to say that they expect to see it, or they are just still waiting to see what the effect is?
MATT EGAN, CNN REPORTER: Well, Jim, they are bracing for trouble, but what is most concerning to me is they don't know what that trouble will actually
look like and so they don't know which way to go. Right?
I mean, should they be cutting interest rates now because all the survey data is pointing to gloom and doom on Main Street and among business
leaders? That would be a way to try to stave off a recession, but they don't know if they should cut because tariffs also will impact prices --
increase prices.
And so if they end up cutting rates prematurely, they could actually make inflation worse. So it is really telling that not even the Federal Reserve
knows which way to go here, and that is just kind of speaking to this almost impossible situation that the Fed finds itself in right now, where
really they are being pulled in opposite directions by the trade war.
They don't know if they should be fighting unemployment or fighting inflation, and what was also notable was I had the chance to ask Fed Chair
Jerome Powell about these concerns around potential shortages and what exactly the Fed has in its tool chest to try to prevent tariff related
disruptions to the supply chain from doing damage to inflation and consumer psychology.
Take a listen to what Powell said.
(BEGIN VIDEO CLIP)
POWELL: I mean, we don't have the kind of tools that are good at dealing with supply chain problems. We don't have that at all. That's a job for the
administration and for the private sector more than anything.
You know, what we can do with our interest rate tool is we can support, be more or less supportive of demand and that's -- that would be a very
inefficient way to try to fix supply chain problems.
But, you know, we don't see that. We don't see inflation yet. We are of course reading the same stories and watching the same data as everybody
else. And you know, right now, we see inflation, you know, kind of moving sideways at a fairly low level.
(END VIDEO CLIP)
EGAN: Now, whenever there is trouble in the economy, everyone always looks to the fed to try to come to the rescue, but I think the bottom line from
Powell is, this is really not a job for the Fed. Right? The problems in the economy right now are largely related to this trade war shock and all of
the uncertainty around tariffs and the Fed, like the rest of us, just needs to wait around and see how this plays out -- Jim.
SCIUTTO: Matt Egan, thanks so much.
EGAN: Thanks.
SCIUTTO: Joining us now is Alan Blinder, he is a former Vice Chair of the U.S. Federal Reserve.
Good to have you on, sir. Thanks very much for joining.
ALAN BLINDER, FORMER VICE CHAIR OF THE U.S. FEDERAL RESERVE: You're very welcome. Good to be here.
SCIUTTO: Given your past experience with the Fed and you are a reliable Fed watcher. When you listen to the chairman's comments there and read the FOMC
statement, is the Fed expecting to see economic impact from the tariffs and just hasn't seen it yet? Or is it leaving its mind open saying, hey, maybe
the economy gets through just fine.
BLINDER: Well, you can do both, but I think, it is definitely expecting negative impacts on both sides of what they call its dual mandate, that is
negative impacts on inflation, which is higher, and negative impacts on growth, which is lower.
They expect to see that, but his main point is we are not seeing it yet.
SCIUTTO: Now you, in March, prior to Liberation Day, as President Trump has called it, you estimated a 50 to 60 percent chance of U.S. recession within
a year. Where do you put the chances now?
[16:20:01]
BLINDER: I would -- I am pretty close. If I was writing that now, I might say 60 to 70. That's not -- that's an insignificant change I feel about the
way I thought. I feel now about the way I thought I would feel when I wrote that in March.
SCIUTTO: I mean, the effects of Trump's tariffs, right, are and it is early, and of course, he could pull back but he keeps getting asked about
it. For instance he was asked today about China, he says no, I am not going to pull back the tariffs on China. They are upsetting the markets, the bond
markets. We are seeing ups and downs everywhere. We are about to see poor traffic into the West Coast of the United States fall off a cliff.
I mean, is there any chance that the economy just shrugs this all off?
BLINDER: Look, if you put it that way, any chance miracle -- a semi miracles can happen. But I would -- I think the chances are very low. We
are looking at what is probably going to be, in economic parlance, a fairly significantly large supply shock. So we are kind of familiar with supply
shocks not caused by tariffs like this, unless you go back to Smoot-Hawley.
SCIUTTO: Yes.
BLINDER: But we've experienced supply shocks from the pandemic earlier than -- and that was severe -- earlier than that from oil shocks and food
shortages and things like that going back over history.
So supply shocks are not new. They are not that common and mostly, they're not good. They're not good for the economy and they put the Central Bank in
a very difficult position because, as your previous speaker said, they don't know whether to fight the inflation or to fight the incipient
unemployment.
SCIUTTO: Now, you're the economist, of course, but the way I remember it, with the supply shock as it related to the pandemic, was that that was
really the key ingredient to global inflation. And that proved very persistent. Right?
Years, I mean, and by the way, it is having political consequences in a whole host of countries. If you're seeing that coming, does the data then
point you towards sustained higher prices coming down the line?
BLINDER: It is first -- the honest answer is it is impossible to predict unless you can predict Donald Trump, which I can't, but there is a real
chance that this lasts a long time. What is it -- 99 deals or something like that? He won't do that in 99 days, if there are going to be 99 deals,
which I doubt, but if they are going to be anything like that, it is going to take a while.
It also takes a while for the supply shock, which takes place at the ports, so to speak, euphemistically speaking to filter into the whole cost
structure of the economy.
And then finally, there is the very important point that Powell made in answer to some of the questions, which is what happens to inflationary
expectations? If they stay stable, this thing can go away faster. If the higher prices feed into higher expected inflation, it will last longer.
SCIUTTO: Yes. If a supply shock leads to higher prices, as I imagine it does, does it also impact the job market? I mean, I am thinking about the
way Americans and others would feel the effects of this themselves.
BLINDER: Definitely. But I think I like the way you asked the question, because I think that probably comes second. You see, the initial impact on
prices.
You see consumers then losing purchasing power or being repelled by the high prices and deciding, if I may say so, to buy two dolls instead of 30
dolls, a slightly ridiculous idea, but the idea of spending less is not a ridiculous idea. It is the likely outcome of the supply shocks, and that is
what leads to a shrinking, or at least at minimum, a slower growing economy and probably a shrinking economy, and that in turn leads to fewer jobs.
SCIUTTO: Math is simple.
Alan Blinder, thanks so much for joining.
BLINDER: Sure thing.
SCIUTTO: Well, the U.S. Treasury Secretary told members of Congress today that trade negotiations with China will begin on Saturday in Switzerland.
Scott Bessent says he and U.S. Trade Representative Jamieson Greer will both attend those talks. They come as the first cargo ship subject to the
massive 145 percent tariff on Chinese goods begin to arrive in U.S. ports. That is raising concern over, well, what we were just talking about there,
supply chain and price pressure.
[16:25:08]
The Vice President also spoke on trade with China at a conference today.
J.D. Vance outlined what he believes should come out of those negotiations.
(BEGIN VIDEO CLIP)
J.D. VANCE (R), VICE PRESIDENT OF THE UNITED STATES OF AMERICA: We cannot absorb hundreds of billions of dollars, close to a trillion dollars per
year in annual surplus, most of it coming from the People's Republic of China, and what that is going to mean in the rebalancing is that we think
that the PRC is going to have to, frankly, let their own population consume a little bit more. They've held consumption levels down in order to
increase these massive exports.
It means that American manufacturers are going to have to be treated more fairly in some of these global trade deals, it means we are going to have
to cut some new trade deals with some of our friends in Europe, but also with some of our more adversarial nations.
(END VIDEO CLIP)
SCIUTTO: Kevin Liptak is in Washington, and I wonder what the administration's expectations are for these talks with China, because when
I speak to diplomats in Asia, they say that China feels quite strong going into these negotiations and not in any particular rush to accommodate
President Trump.
KEVIN LIPTAK, CNN SENIOR WHITE HOUSE REPORTER: Yes, and the way that American officials are framing it is essentially an icebreaker conversation
between two sides that, until this point, really have not been in any kind of substantive talks about trade, despite what President Trump has been
saying over the last three weeks, there really haven't been this kind of concerted effort to bring the two sides to the same table and try and do
something about this tit-for-tat trade war that has been roiling the global economy.
But still, even today, you see the two sides kind of dug in on this face saving exercise.
You have China on the one hand saying that it was the United States who asked for this meeting, who initiated the communication to try and get
these talks underway. But when you heard from President Trump in the Oval Office, when he was asked about that, he said, no, that's wrong, that China
needs to go back to their files and look at exactly what happened.
And so you still see this effort on both sides here to try and sort of save face in a lot of ways. President Trump and President Xi have been locked in
this standoff for the last several months, neither of them seeming to be the one that looks to be the one that is picking up the phone and making
the first telephone call, all the while, this trade back and forth has caused so much turmoil in the markets and potentially for consumers.
And so when you listen to American officials, they don't necessarily have huge expectations for these meetings. They don't expect Scott Bessent to
leave Geneva at the end of the weekend with a grand deal in hand.
And in fact, President Trump said just today that he doesn't plan to lift that 145 percent tariff that currently rests on China. Instead, what it
seems to be is that these two sides will come to some sort of framework about how the talks will proceed and about what exactly could be on the
table.
Scott Bessent said in an interview last night that the goal overall is de- escalation, but in terms of specifics and in terms of what exactly the two sides will be able to de-escalate, I think still remains very much to be
seen.
SCIUTTO: And at what pace?
Kevin Liptak, thanks so much.
Coming up, India and Pakistan facing the risk of a wider conflict, latest in a long history of violence over the disputed Kashmir region.
(COMMERCIAL BREAK)
[16:31:42]
SCIUTTO: Hello, I'm Jim Sciutto.
There's more QUEST MEANS BUSINESS in a moment when black smoke from the Sistine Chapel's chimney means the cardinals will spend at least one more
day voting on the next Pope. We're going to have a live report from Rome. And Disney is opening its first theme park in years. We'll tell you why
it's choosing Abu Dhabi for the next Disneyland.
Before that, the headlines this hour.
Pakistan is vowing retaliation for a series of airstrikes by India on Pakistan. India says the attacks targeted terrorist infrastructure both in
Pakistan and Pakistan-controlled Kashmir. Pakistan says those strikes hit mosques and killed civilians. Tensions have been running high since last
month, when militants killed 26 people, the majority of them Indian nationals, inside Indian-controlled Kashmir.
The Federal Reserve has decided to hold interest rates steady amid concerns that U.S. tariffs could take a toll on economic growth. The Fed is warning
that the risks of both higher inflation and higher unemployment, a combination which is known as stagflation, have increased.
And the results of the first papal ballot are in and the black smoke from the Sistine Chapel says it all. No new Pope yet. A cardinal must receive at
least two-thirds of the vote to be elected. This means the conclave will need to deliberate a bit more before choosing the next leader of the
Catholic Church.
We're turning now to developments on the India-Pakistan border. Pakistan's defense minister tells CNN the military is trying to avoid these strikes
from becoming a full-fledged war. Still, he told my colleague Becky Anderson that India's actions were, quote, "an invitation to expand the
conflict."
India says it targeted what it described as terrorist infrastructure because Pakistan failed to act against terror groups operating on its
territory.
Vedika Sud has the latest from New Delhi.
(BEGIN VIDEOTAPE)
VEDIKA SUD, CNN CORRESPONDENT: Tensions between India and Pakistan have seen a major escalation after India carried out a series of military
strikes in Pakistan-administered Kashmir and inside Pakistani territory. Its deepest strikes in Pakistan in five decades. The strikes took place in
the early hours of May 7th, between 1:05 and 1:30 a.m., targeting nine sites that Indian officials say were terror training camps spread across
Pakistani-administered Kashmir and within Pakistan.
VIKRAM MISRI, INDIAN FOREIGN SECRETARY: Despite a fortnight having passed since the attacks, there has been no demonstrable step from Pakistan to
take action against the terrorist infrastructure on its territory or on territory under its control. Instead, all it has indulged in are denials
and allegations.
Our intelligence monitoring of Pakistan based terrorist modules indicated that further attacks against India were impending.
SUD: India says the strikes were in direct response to last month's militant attack in Pahalgam in Indian-administered Kashmir, where 26
people, most of them Indian nationals, were killed.
[16:35:04]
Islamabad repeatedly denied involvement in that attack. At a press briefing Wednesday, Indian authorities described the sites they've targeted in their
strikes as long standing hubs for militant training, some linked to previous attacks on Indian soil.
The political response in India has been swift. Prime Minister Narendra Modi's ministers have publicly praised the strikes, calling them precise,
necessary and justified. India has also repeated accusations that Pakistan provides safe haven to terror groups, a charge Pakistan strongly denies.
This major escalation between two nuclear armed neighbors has sparked renewed international concern over stability in South Asia.
Vedika Sud for CNN in New Delhi.
(END VIDEOTAPE)
SCIUTTO: Well, Kashmir has been a flashpoint between India and Pakistan for decades. The two nations have fought several wars over the territory. The
first took place in 1947 right after partition, when they gained independence from the U.K. The most recent clash in 2019 when India carried
out airstrikes after a suicide car bomb.
Ayesha Siddiqa is a senior fellow in the Department of War Studies at King's College London, and she joins me now.
Thanks so much for joining.
AYESHA SIDDIQA, SENIOR FELLOW, DEPARTMENT OF WAR STUDIES, KING'S COLLEGE LONDON: Thank you for the invitation.
SCIUTTO: So we're in the midst of this delicate math of Pakistan somehow developing a response that does not escalate this conflict further, which
seems to be at least it's their stated intention not to escalate further.
What might that look like? How does Pakistan respond without then getting both countries caught in another cycle of attack and retaliation?
SIDDIQA: You know, Pakistan, what it started to do before India's attack was up, this morning, was send a signal, send messages, basically saying
that Pakistan will escalate, hoping that it would deter, I mean, Pakistan even said that it would use the full spectrum of its defense, which means
from conventional to nuclear. It expected, it hoped that that would deter India. It didn't.
Now, what's very peculiar about these attacks this morning is that it's after 1971. You know, more than 30 years, I would say, when India has
attacked across the international boundary in Punjab, which is one of the main population centers, main, you know, provinces or states of Pakistan.
It's also Pakistan's power hub. So this was a shock. This was not really expected.
SCIUTTO: Right.
SIDDIQA: So now the question for Pakistan is, if it doesn't respond this kind of an attack, then it would not deter India in the future. This is not
a conflict which is about to come to an end. And if it does, how is -- at what point would it manage to deter India without allowing it to escalate
further? I mean, let's not forget both are nuclear weapon states.
SCIUTTO: Let me ask you this. As you know, Pakistan is claiming to have shot down as many as five Indian fighter jets. French officials are telling
CNN that the manufacture of India's Rafale jets has confirmed the loss of at least one.
How is that significant in this? And is it possible that if that is true, that it gives Pakistan some ability to say they have already struck blood,
as it were?
SIDDIQA: If we were to copy the formula of 2019 retaliation, attack and retaliation, so in 2019, India carried out a precision attack across the
international boundary in Pakistan mainland territory in Balakot. And in response Pakistan kind of attacked across the line of control and then the
dogfight which happened drew one MIG-21 inside Pakistan, and then it was shot down and they could talk.
There was a prisoner of war, you know, the pilot, Indian pilot, Abhinandan, Indian air force pilot Abhinandan. And so, you know, they could stop it.
Right now they don't have that kind of an advantage. There's nothing to kind of exchange, stop the conflict and talk to each other about it.
SCIUTTO: Right.
[16:40:05]
SIDDIQA: So Pakistan still has this excuse to kind of move on and push in their back.
SCIUTTO: Before we go, you've written recently for "The New York Times" regarding the trouble inside Pakistan's military, in particular the
perception in Pakistan, particularly among Imran Khan's party, that the military intervened, intervened in elections.
What is the level of public support for the Pakistani military today? Does it have the confidence of the Pakistani people?
SIDDIQA: You know, this crisis may have kind of helped the army chief, General Asim Munir, who's been responsible for pushing Imran Khan out as
kind of regaining some of the space. It's not that he's politically popular, it's just that at this time of crisis, it has brought people
together. So people, given that Pakistan's current political structure is so weak, the political government is just a political government in name.
And actually a lot of governance, a lot of control is with the army chief. So people understand that in time of crisis, the only institution which
survives and which is there to protect them, in case if India attacks, is the Pakistan army.
Now, this is, I would argue, still very temporary and he would have to build on it. You know, he benefits. And I think what another thing which
you need to look into which I think it's important to look into, is that unlike the past, when the United States was eager enough to jump into the
crisis between the two countries and kind of persuade them to split up and, you know, kind of bring down the temperature, this does not seem to be the
intent from Washington. I mean, Washington is basically saying you sort it out yourself.
SCIUTTO: Yes.
SIDDIQA: And that is, I think, much more critical. So on the one hand the general, the army chief benefits from the crisis, which will put Pakistan's
political system into another kind of a crisis. On the other, I think if there is a benefit from all of this going to Pakistan military, it's
because of the nature of the current geopolitical system.
SCIUTTO: Ayesha Siddiqa, thanks so much for joining.
Well, it is, as we said, day one of the conclave in Rome and the first round of voting has ended without a new Pope, as signified by black smoke
rising from the Sistine Chapel. We're going to have a new report from Rome next.
(COMMERCIAL BREAK)
[16:45:26]
SCIUTTO: Well, there it is. Black smoke from the chimney atop the Sistine Chapel in Rome, indicating no one has yet received enough votes to be
elected Pope on the first ballot. The process of selecting the successor to Francis has begun. 133 cardinal electors are now sequestered inside Vatican
City. They're taking part in the secretive process of choosing a new Pope. Once they decide it would be white smoke we see billowing from that
chimney.
The direction of the church is at stake. Cardinals might the reformer like Francis, or someone bound more by tradition and doctrine. The customs
surrounding the modern conclave originated 800 years ago. That's modern by church standards. The elaborate voting process dates back to the early
Middle Ages. It was born out of frustration after cardinals took three years to select a Pope between the year 1268 and 1271.
Pope Gregory X created rules to prevent that from happening again. The conclave used to take place in various locations before a fixed setting was
decided upon. It was first held in the Sistine Chapel way back in the 15th century, and every conclave has taken there since 1878.
Joelle Rollo-Koster is a professor of Medieval history at the University of Rhode Island.
Thanks so much for joining.
JOELLE ROLLO-KOSTER, PROFESSOR OF MEDIEVAL HISTORY, UNIVERSITY OF RHODE ISLAND: Thank you for inviting me.
SCIUTTO: So first, I wonder if you could describe where this decision stands in terms of how it will reflect a division to some degree in the
church on where to go going forward. Pope Francis tried to reorient the church towards its pastoral mission, service to those in need. His
predecessors were more focused on enforcing doctrine.
ROLLO-KOSTER: So contrary to what I have heard quite a lot, I do not think there is such a huge difference between what we would call the liberal
party and the conservative party. I think the message is more or less the same. It is more of the way the message is being presented. The dogma has
not changed. There is still no clerical marriage, and even a liberal would not offer a clerical marriage. There is still no women in very high-ranking
positions or women ordained in the church.
So I do not personally see, and I'm thinking more with in relation to the history, to the long history of the church. I don't see such a cleavage. I
think the attention should maybe be put, as you stated, between an internal vision of the church or an external vision of the church, but the external
vision of the church is absolutely related to the state of the internal vision of the church.
So I think for me, it's a question of what will these cardinals agree on, which is the number one internal issues, and then they will work on how to
present that issue, how to deal with it in the external world. So I don't know if I'm kind of, you know, turning your question around.
SCIUTTO: No, that's OK. Well, can you tell me what then the issues are, the internal ones versus the external ones? The internal ones, are we talking
about the internal politics of the church?
ROLLO-KOSTER: OK. So for me, the internal issues, something that Francis really spent a lot of time on but we don't hear a lot is something that is
part of the long history of the papacy. And that's the issue of finances, of reforming the way the Vatican deal with its banks, with its investment.
I mean, the Vatican is a huge investor. It owns something like 5,000 properties. It has been losing lots of money. Its pension plan has been
losing lots of money. Its Peter Pan is not bringing enough of the money. And all of this needs to be managed.
So I think the -- I'm looking at it not so much as a financial preoccupation being like an obsession.
SCIUTTO: Right.
ROLLO-KOSTER: But it is present and you need an administrator. You need somebody who is able to deal with this. And again, Francis had started and
actually Francis brought in financial specialists and -- but I, you know, I'm not connected to that world, so I'm a Medieval historian.
SCIUTTO: Understood.
ROLLO-KOSTER: So I have no clue what it was decided. But there was an attempt because that's a pressing need.
[16:50:02]
SCIUTTO: How about on the regional aspect? Because it's often been noted that the church is not growing, even shrinking in the West to a large
degree, that the majority of its growth is taking place in Asia and Africa. And you do have candidates, potential new Popes from Asia and Africa. Does
that lean the church in that direction of picking a leader from one of its growth regions?
ROLLO-KOSTER: That's history of the church. The history of the church, of the conclave and of the nomination of a Pope has constantly been linked to
national issues. On the other hand, if, let's say, financial issues are pressing, will these candidates from, let's call it the global south, do
they have the experience to deal with something where I would say somebody with central to the curia in Rome is more aware of.
So this is where it becomes very delicate. And this is why I'm kind of irritated by all of those predictions because conclave is secret and we are
not, we do not know what they consider the most pressing issues. And it's very difficult to identify what is going to create a cohort and how they
are going to coalesce around somebody who can deal with what they consider the pressing issues, not us.
SCIUTTO: Professor Rollo-Koster, we appreciate you helping us understand it all.
ROLLO-KOSTER: Thank you. Thank you.
SCIUTTO: Well, Disney has just announced its first new theme park in 15 years. The company plans to build it in Abu Dhabi. And investors are
rejoicing. We're going to look at why they're going there right after the break.
(COMMERCIAL BREAK)
SCIUTTO: It was a magical day for Disney shares. The stock closed up more than 10 percent following strong earnings and the announcement of a new
theme park in Abu Dhabi.
CNN's Natasha Chen has the story from California.
(BEGIN VIDEOTAPE)
NATASHA CHEN, CNN U.S. NATIONAL CORRESPONDENT: Disney's announcement of this newest theme park and resort in Abu Dhabi comes just as their
quarterly earnings call showed that they really had revenue surge in the first three months of the year, and that U.S. park attendance was back up
even after a modest decrease last year.
Investors really like this news in combination. Disney stocks were up at the open and people are looking at this saying that theme parks really are
a resilient part of the Disney business and taking up potentially more of the Disney pie.
[16:55:11]
Now, this is a really interesting challenge for Disney to enter the Middle East, where they say that there is so much potential to reach more
consumers who currently can't easily access one of their existing theme parks around the world. Specifically, they're talking about a large
population in India, for example, who might be able to take a shorter flight to Abu Dhabi than they could to Shanghai or Hong Kong Disney Parks.
They're talking about a potential 500 million people who may have the means in that region to visit Disneyland Abu Dhabi. Now, the structure of this
agreement is with a local company in Abu Dhabi called Morale. They have actually developed other theme parks there. Morale will build, develop and
operate this one while Disney imagineers lead the creative design and oversee operations.
The Disney Experiences chairman, Josh D'Amaro, sat down for an exclusive interview with our Becky Anderson, talking about the decision to choose Abu
Dhabi as a location.
BECKY ANDERSON, CNN INTERNATIONAL ANCHOR: You've got parks in Asia, you've got parks in Europe. This is a global hub. I mean, you get this access to
this enormous number of visitors and they are increasingly coming here to Abu Dhabi.
What are the new groups that you're looking for? Where have you identified as growth markets that you think you can take advantage of here?
JOSH D'AMARO, CHAIRMAN, DISNEY EXPERIENCES: Well, first of all, right here in the Middle East, we know that we've only scratched the surface in terms
of catering to this population. While we'll see guests from this area in our theme parks, in the U.S. and in our international parks, again, we're
only scratching the surface.
We think about a market like India, which is a massive market for us and the Indians' love of the Disney brand is significant. So throughout this
whole region, although we've catered to these guests before, we haven't been able to serve them in a proximate way, and we're going to be able to
do that now.
CHEN: D'Amaro said this is going to be their most technologically advanced park they've ever built. It does take about five to 10 years to build a
theme park and so the opening date might be in the early 2030s. The look of this one is going to be a bit different, too. You can see in the artist
rendering, there's this crystal spiral structure that will be their castle, looks a bit different from their fairy tale like icons in the other parks.
D'Amaro also said that they're going to be incorporating potentially immersive gaming here, so that what someone experiences in Fortnite, for
example, can translate into what they experience in the park in person and vice versa.
Natasha Chen, CNN, Burbank, California.
(END VIDEOTAPE)
SCIUTTO: Well, U.S. markets closed higher after the Federal Reserve held interest rates steady for the third straight meeting. The Dow closed about
285 points higher. S&P 500, Nasdaq both turning positive after a volatile afternoon of trading.
Shares in major chip makers soared toward the end of this session. That's because of a report from Bloomberg saying the Trump administration will
ease trade restrictions on A.I. chips. Nvidia shares rose 3 percent. Other chip makers, such as AMD and TSMC, closed 1 percent. Well, close to 2
percent higher.
That is QUEST MEANS BUSINESS for today. I'm Jim Sciutto in for Richard. "THE LEAD WITH JAKE TAPPER" is next.
(COMMERCIAL BREAK)
END
