Hindu leadership demanded the partition of overall muslim majority Punjab and Bengal after rejecting Cabinet mission proposals of a united india and made it clear to Pakistan that only muslim majority areas will go to it. Kashmir's entire state is muslim majority, hence, india has no claim over it. If legal claim is invoked, Pakistan has a stronger claim to Junagadh.
india initially occupied Kashmir to make it an anti Pakistan state which didnt work and now it has become a war trophy. So, india will continue to drain it resources and bleed which is good for Pakistan and China. The more india deploys its military and financial resources the weaker it will become. Pakistan must continue to impose a maximum possible cost on india, its simple