Fair enough. I see where you are coming from. Though being "Indian" I remain skeptical. I'll tell you why..
Differences aside the Western and Eastern world remain united on a few constants, basic human rights being one of them. There exists aberrations obviously. You have your Tianmens and we have your Sikh/Muslim riots and pogroms, but by and large all parties agree that all men and women irrespective of their religion are born equal and should be accorded equal rights.
That is unfortunately not the case with your partner, what with the concept of second class citizens, ahmadiyas and what not .. There are tons of other stuff I'm not inclined to point out for obvious reasons.
Your core beliefs and character are as diametrically opposed to them as oil and water. You know that.
Come on, I seen China's rich and powerful legally rob poor peasants, I seen India's rich having guards around their luxury cars so no one gets close. China and Pakistan may not be ideologically twins, but we share a common interest, theirs is to develop their country and ours is to extent our influence.
Pakistan's problems are the same as China and India's. Poverty. China's poor are now getting better opportunities and treatment than India's poor mostly because we developed more. It certainly isn't because we became better people, I mean obviously. The same will happen for Pakistan.
As far as the financial motives go, I see China pouring in billions of dollars with practically no quid pro quo. Is your partner honestly that big a market for your goods? Is it worth vexing the "Indian" market for as trivial a point as NSG.. (we benefit from it anyway as it is as you pointed out earlier).
Allies are transient. You would know. Look at Japan and America ...
I just hope this fracas doesn't boil down to a juvenile clash of egos between two major powers. There is much we can do (are doing) together.
Market is tricky to define, we have a huge trade surplus because we offer a good product at the price, that domestic Indian companies cannot. It's that simple. It's not a conspiracy. We are global and Indian manufacturing largely isn't, hence the lower price, that and infrastructure, availability of skilled workers and government assistance and all that.
Even if you do try to ban our products, all that would do is put you in the dog house of global reputation and in reality would do little to make you competitive globally, if not worsen. I mean that is the reason no nation has ever done that to another nation, except the Soviet's Berlin wall. Neither of those exists now.
Market to me, in this context, has to be strategic. India won't buy our weapons, key infrastructure, nuclear reactors and a host of other big ticket nation to nation items. In this sense, Pakistan is far and away the bigger market.
The civilian markets will fall where they will, on a national scale, Pakistan is our biggest customer by far and, in this context, India isn't even more important than Sudan.
As to clash of ego, to see how this isn't about India, China invited Modi to APEC, China invited India to SCO, China made India the second largest member in AIIB and certainly extended invites to one belt and more. China is not against India in far more important institutions but this is a sour point?
It's obvious to me this is about CPEC and China's desire for further Pakistani deals in civilian nuclear sector, which we cannot get without them in the organization. Or at least difficult.